Deals and Dollars: Banks look to cloud tech, fintech funding on the rise

Banks this week announced deals to implement cloud-based services and core systems to unify and streamline services; meanwhile, investments in fintechs, including embedded payment systems providers, continue to spike. Frost Bank & Blend San Antonio-based Frost Bank is expanding its relationship with cloud banking process automation software provider Blend, whose list of some 300 customers includes Wells Fargo , BMO Harris Bank , U.S. Bancorp , Truist and Navy Federal Credit Union . The $46.7 billion Frost Bank first tapped Blend for its home equity loans and lines of credit offerings. Now looking to further its digital transformation strategy, the bank said it will use Blend software to drive efficiency and simplify processes in mortgage, consumer banking and deposit accounts business lines. Frost Chairman and Chief Executive Phil Green said in a release that working with Blend "will allow us to be involved in the entire process from start to finish." The expanded partnership "will create consistent and streamlined customer experiences across all banking products and services and allow customers to set up seamless auto-payment options with deposit account openings on a single platform," according to the release. The unified digital portal is also expected to improve efficiency for Frost loan officers. JIC Bank International & Technisys San Juan, Puerto Rico-based JIC Bank International will implement the Cyberbank cloud-based core system from Technisys . Cyberbank is a white-label banking platform designed to deliver personalized financial products. Having Cyberbank as its core banking platform will allow JIC to "create novel financial products that are tailored to the specific needs of each and every customer, on any device," Chief Financial Officer Joseph Tempelberg said in a release. Atabey Perez Castro, general manager of JIC Bank, noted that the Technisys platform provides "low-to-no-code ease." JIC said it will use Cyberbank to eliminate "siloed and disjointed customer experiences" for business customers, initially focusing on digital wallet capabilities and consumer and commercial deposit accounts. A statement from Technisys claimed Cyberbank's API-centric architecture would allow JIC to be "up and running in as little as six months." First Internet Bank & ApplePie Capital First Internet Bank and ApplePie Capital this week announced a loan purchase agreement to provide financing for franchisees. The $4.2 billion branchless First Internet Bank, founded in 1999, expects to purchase $100 million of "ApplePie Core"' conventional loans by yearend. First Internet Bank offers services such as consumer and small business deposits and consumer loans, as well as commercial and industrial loans, Small Business Administration financing and treasury management services. San Francisco-based ApplePie provides financing to allow franchisees to start or expand their franchise business while investors can earn fixed-income returns. Since January 2015, the company has facilitated more than $1.25 billion in loans. Fintech investments growing The fintech sector is seeing continuous growth in venture capital funding, S&P Global reported in an analysis released Thursday. Fintech venture capital investments in the United States grew 70% year over year in the second quarter to nearly $7.5 billion, and in the United Kingdom, the fintech sector saw $5.7 billion in venture capital in the first half of 2021. That is "well above pre-COVID-19 pandemic capital inflow," according to S&P. After a year of the pandemic in 2020, average post-money valuations for fintechs spiked toward the start of 2021, reaching $1.42 billion in the first quarter compared with $593.6 million in the last quarter of 2020. Post-money valuations dipped to an average of $1.08 billion during Q2 but rebounded to about $2.11 billion at the end of the third quarter, S&P reported. Global processing services Global Processing Services (GPS) on Wednesday said it has raised more than $300 million in private equity funding from Advent International and Viking Global Investors, which will co-control the company. With offices in London and Newcastle in the U.K. as well as in Singapore, Sydney and Dubai, GPS is certified by Visa and Mastercard to process and manage any credit, debit or prepaid card transaction globally. GPS's "API-first," cloud-based payment platform enables card programs for fintechs, digital challenger banks and embedded finance providers. It processed more than 1.3 billion transactions in 2020, according to the company. GPS Chief Executive Joanne Dewar said the funding will allow the company "to turbo charge our geographic footprint and product expansion plans as we drive the payments ecosystem in the key verticals of today and tomorrow, including digital banking, buy now pay later [BNPL], [business-to-business] virtual cards, financial empowerment and much more." GPS clients include U.K.-based digital banking services providers Revolut and Curve , BNPL provider Zilch and $7.9 billion digital challenger bank Starling Bank as well as Paidy , Japan's largest BNPL company. Alviere New York-based embedded finance platform provider Alviere this week closed a $50 million series B funding round. This follows a $20 million series A funding round in April, bringing total funding for Alviere, which was founded in 2017, to $70 million. The company said it will use the capital to accelerate its go-to-market plans and expand into Europe and Latin America. Alviere's HIVE embedded finance platform allows businesses such as retailers, software companies and marketplaces to embed financial services, including FDIC-insured checking and savings accounts; debit, credit and prepaid cards; gift cards; payment services; domestic and international money transfer; and currency exchange. The HIVE offerings include artificial intelligence (AI)-based security, compliance and risk management, fraud protection and regulatory licensing.

Deals and Dollars: Banks look to cloud tech, fintech funding on the rise

Money flows into digital payments while banks look to cloud-based software and core providers to advance digital offerings

Citi develops embedded finance services, adds 80 partner APIs

Truist sees significant growth across digital assets in Q3

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Deals and Dollars: Banks look to cloud tech, fintech funding on the rise

Money flows into digital payments while banks look to cloud-based software and core providers to advance digital offerings

Citi develops embedded finance services, adds 80 partner APIs

Truist sees significant growth across digital assets in Q3

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