New banks

It’s really expensive to build a new core: Fiserv acquires Finxact

  • Fiserv is acquiring upstart cloud native core banking software provider, Finxact.
  • Fiserv now has the capabilities to bring its clients into the future with API connectivity and personalization capabilities.

Email a Friend

It’s really expensive to build a new core: Fiserv acquires Finxact

What’s happening: Fiserv announced yesterday it has signed a definitive agreement to acquire Finxact. Finxact offers a cloud-native banking core as an alternative to other core providers like Jack Henry, Finastra, and FIS. Fiserv was an early investor in Finxact and will acquire the remaining ownership interest for approximately $650 million.

Why’s it important: Finxact helps round-out Fiserv’s digital banking strategy, sitting alongside the firm’s account processing, digital, data aggregation, and payments solutions. As FIs and leading brands outside of finance are taking up technology for embedded commerce, finance and payments, Finxact can help Fiserv provide clients modern, flexible, and personalized digital banking experiences. Fiserv clients will need these capabilities if they want to launch competitive new products and partner with other tech firms.

We’re in the process of a slow, multi-year rollout that has banks and other FIs migrating to digital cores. The success of fintechs as alternatives to banks and the pandemic’s push towards digital are putting added pressure on banks to move to digital.

  • For example, Jack Henry has been making progress moving its bank and credit union clients, like $25 billion Simmons Bank, to its Banno Digital Platform. 

Finxact history: Founded in 2016 by Frank Sanchez, Finxact’s core helps organizations of all sizes launch new products and digital capabilities via a set of APIs. Finxact also offers a marketplace where banks can integrate tech and data firms like Codat, Apiture, and MX.

0 comments on “It’s really expensive to build a new core: Fiserv acquires Finxact”

Member Exclusive, New banks

Banking Briefing: Interest rates, big banks, and Revolut’s bumpy road to super-app-dom

  • The Central Bank raised its benchmark interest rate by half a percentage point. But with more fintech competition than ever, can major banks afford to respond the way they have in the past?
  • Meanwhile, Revolut’s super app strategy is hitting some bumps. What does that mean for the firm?
Rivka Abramson | May 09, 2022
Member Exclusive, New banks

Banking Briefing: A look into new challenger bank Zolve and a few thoughts on niche banking apps

  • How far can this world of niche challenger banks go?
  • Plus, as income sources become more varied, so are lending strategies.
Rivka Abramson | April 26, 2022
Member Exclusive, New banks

Banking Briefing: More eyes on core banking software

  • Core banking software may not have been as scrutiny-grabbing as BNPL or crypto, but now that the industry is growing, the CFPB is taking notice.
  • Meanwhile – what’s up with Apple’s recent acquisition of Credit Kudos? And just how do banks play a role in consumers’ mental health?
Rivka Abramson | April 18, 2022
New banks, Podcasts

The Banking Podcast Ep. 17: The story of Dave going public and BNPL as the new challenger bank

  • Episode 17 of the Banking Podcast explores Dave's challenges as a public neobank and what that means for the rest of the industry.
  • Hosts Zack Miller and Josh Liggett also talk about BNPL, MetaBank, and Apple and its acquisition of Credit Kudos.
Zachary Miller | April 04, 2022
Member Exclusive, New banks

Banking Briefing: What Biden’s executive order means for crypto growth

  • With Biden’s executive order showing more interest in crypto development, the next question is what does that mean for the future of banks and digital currency?
  • Meanwhile, fintech bank charters are heating up. But that’s not necessarily a bad thing for incumbents.
Rivka Abramson | March 29, 2022
More Articles