We highlight which small banks are working with fintech companies to launch banking products and accrue deposits.
Small banks — banks with less than $10B of assets — are losing the battle for consumer deposits.
Today, midsize and local banks capture only 7% of the customers who switch banks. Deposits at banks with less than $10B of assets fell 3% in the 12-month period that ended June 30, according to the FDIC.
To remain relevant, smaller banks are partnering with fintech companies to build new deposit channels and revenue streams. This business model — or the process of opening a bank’s platform to outside developers — is referred to as Banking-as-a-Service.
The graphic below shows how some of the top small banks (by assets under management) are forming business-to-consumer, business-to-business, and business-to-developer partnerships.