Fintechs Pledge Free Support to US Banks

A growing number of financial technology groups are offering their technology to banks, for free, or at substantial discounts, to help them maintain service levels during the global COVID-19 coronavirus outbreak.

There are now 50 organizations willing to offer fee-free technology or discounted tech support during the crisis, according to a list curated by Forbes.

The assistance from fintechs could prove timely, with many banks still without established digital channels. It comes as many institutions are closing their branches at the direction of the authorities, or to protect their frontline staff.

On Friday (March 20), JP Morgan Chase announced that front line staff would be paid an additional $1,000 bonus for continuing to man call centers and branches during the pandemic. It followed an earlier announcement that it was to close around 20% of its branch network.

The move underscores the problems that even established banks may have in the coming days and weeks to maintain service levels.

Among those fintechs offering support is online and mobile banking platform Bankingly. The company is offering banks the opportunity to use its Android mobile app platform, for free, to publish service updates and facilitate communications during the pandemic.

In pledging its assistance, the fintech said that it hoped it could help banks who have been forced to close. It also suggested that using its technology may help stem customer frustrations which may otherwise lead them to take their business elsewhere to digitally ready competitors.

“Financial institutions that do not have digital channels face a critical situation,” the company said in a statement.

“That’s why we’re offering all institutions that need it a non-transactional Android mobile app at no cost for 3 months and with no commitment to stay.”

Rival Horizn is offering a short-term license version of its cloud-based customer platform and digital demonstrations to help bank clients understand how to transact safely online.

Elsewhere, Digital Align has advised community banks and credit unions that it will grant free access to two fintech products until the crisis passes. The company offers a mortgage process automation tools and a white-labelled platform for online banking.

The generosity of fintechs comes as their services are likely to see greater demand in some sectors. SME lenders in particular are anticipating an uptick in demand, as small businesses seek additional working capital.

Karen Mills, a senior fellow at Harvard Business School, last week, urged SMEs to embrace the lending options from fintech specialists such as Kabbage and Fundbox. Last week, the former launched a specialist website allowing Americans to support small businesses affected by the virus outbreak. More details are available here.