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FinTech Fees Let Sponsor Banks Look Beyond Deposit Growth
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PYMNTS.com
Sponsor banks increasingly appear to be managing FinTech deposits as a balance-sheet resource rather than an asset that must always remain on their own books.
The Bancorp is generating a growing share of revenue from higher-margin FinTech fees while expanding sponsored lending and payments rather than relying solely on deposit growth.
First Internet grew BaaS fee revenue 172% while shifting approximately $2.4 billion of FinTech deposits off its balance sheet through a deposit network.
Banking-as-a-service has traditionally had sponsor banks for doing everything themselves: issuing accounts, holding deposits, processing payments and financing lending.
Average FinTech loans rose to 18% of average loans, while FinTech fee income represented nearly 30% of total revenue.