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A way for smaller banks to access tech sandboxes big banks play in


A startup is hoping small banks will turn to its cloud-based hub that’s modeled on a popular developer platform used by the likes of Uber, Netflix and Airbnb.

Bond Financial Technologies, which launched Tuesday, emulates a messaging service offered by Twilio, a third-party cloud platform that enables software developers to program automated texts and phone calls between brands and their customers.

“Before Twilio existed, companies like Uber needed to work directly with telco companies to make sure they could send a text message to a passenger to tell them their ride was ready,” said Roy Ng, a Bond co-founder and its CEO. Twilio “came in and worked with the individual telecom operators, and then created this platform where innovative companies like Uber could use one API to connect” to the different telecoms.

Ng is hoping to use a similar offering to help resource-strapped banks more easily partner with fintechs to develop apps and offer other digital features. The San Francisco-based Bond is currently working with a regional bank (which it didn’t name) to help make it easier for fintechs to use a demand deposit account product.

“As they’re getting more interest for fintech partnerships, we’re helping them with technology to make those connections in a more streamlined fashion and creating a system of record for all the data that’s being transmitted between the companies,” said Ng, who spent almost three years at Twilio as its chief operating officer.

Bond’s launch adds to the trend of banking-as-a-service platforms entering the market. Walmart, Wealthfront and Uber all work with Green Dot on financial products through the provider’s platform.

Green Dot earlier this year announced plans to launch a simpler version of the platform intended for app store developers, social media influencers and midsize retailers to launch financial products.

BBVA, the U.S. subsidiary of the Spanish multinational Banco Bilbao Vizcaya Argentaria, last year introduced its BaaS service, Open Platform, which is meant for early-stage to enterprise companies to integrate financial services into their products.

Other financial planning companies, including the Carson Group and Betterment, have rolled out banking-like services with third-party providers.

Ng said Bond is different from those efforts in that its focus will be on introducing banks with less than $10 billion in assets to fintechs and brands seeking to deepen customer relationships.

“A lot of brands will want to have banking products to not only augment their financial picture, but also reach a deeper level of association with them,” he said.

In turn, Ng said, banks can use Bond to find and partner with fintechs to fill any gaps in their product offerings.

“Over time, many different banks will come to our platform and look at the best rates to get these fintechs to help with their products,” he said. “And for fintechs, they also now have a variety of bank choices they don’t have today.”

Ng said a vital part of Bond’s platform is the machine learning algorithm it uses to manage the data used for anti-money-laundering and know-your-customer compliance.

“We’re using machine learning to detect any anomalies in the data,” he said.

He added that Bond coordinated with regulators as it developed the platform. That included a meeting with Tracy Basinger, head of financial supervision and credit at the Federal Reserve Bank of San Francisco. “She’s very encouraged by the fact that there’s going to be a platform driving more transparency around the data” being shared between banks and fintechs, Ng said.

Bond also is working with three fintech veterans on its advisory board to ensure it continues to meet bank compliance standards.

The board includes Tim Bogan, who holds a number of key risk and compliance-related positions at LendingClub; Joanne Bradford, the former chief marketing officer at Social Finance; and Benjamin Lawsky, the former superintendent of financial services for the state of New York.

Bond announced its entry into the market with a $10 million seed funding round from Canaan Partners, an early investor in LendingClub.

Michael Gilroy, partner at Canaan, said he envisioned the need for a company like Bond in LendingClub’s early days. LendingClub, founded in 2006, has a longstanding partnership with Salt Lake City-based WebBank to issue the fintech’s unsecured personal loans.

“Those types of relationships with banks were proliferating not just with fintech, but brands in general,” Gilroy said. “We coined the term internally that all big brands will become fintechs.”



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