‘Combining our customer-first focus and local brand’: Inside Seattle Bank’s partnership with Google
- Google's new bank accounts are being launched in partnership with banks around the U.S.
- Seattle Bank, a community bank serving Puget Sound, is collaborating with Google to launch a new Google Plex account.
We’ve been talking for a long time about big tech’s move into financial services. We’ve seen Apple’s launch of a credit card, Amazon and Shopify lending to merchants, and Facebook move deeper into payments on its messaging apps.
News hit this week that gave us more insight into Google’s moves in banking. The company is launching Plex accounts, smarter and simpler bank accounts within a redesgined Google Pay app. Google isn’t becoming a bank — these accounts are launched in collaboration with chartered banks, like Citi and BBVA.
Seattle Bank also landed a partnership with Google. The sub-$1 billion community bank in the Pacific Northwest will also work with Google to launch a Plex account. I spoke with John Blizzard, Seattle Bank’s president and CEO about the move and what it means for the community bank. We discuss if other small firms can and will replicate these types of partnerships with big tech. John shares his vision for the future of small banks and technology.
The partnership with Google
We’re very excited about [our partnership with Google]. And for us, it’s great, because we really did this for three reasons. And that was to offer the best product we can in the market. We don’t try to be all things to all people. But when we do enter a niche or a market area, we want to offer the very best products or services. So [this partnership] enabled us to do that.
For us, it’s a new market opportunity with digital first customers, which is terrific, versus our traditional commercial clients that are more hands on.
And [working with Google] really allows us to leverage our technology strategy, which is a cloud based, API-ready, core system.
Tech strategy for a community bank
Our tech strategy has been in the works for years. We learned early on, and maybe naively, say five to six years ago, when we tried to do new fintech-oriented stuff for our clients — where we could really add cool, valuable experiences, we learned pretty quickly, you actually can’t do much of that with traditional bank legacy technology. It’s very difficult. The way the systems and the vendors are all set up, there’s just no good alignment there.
And so we decided over a couple year period, that ultimately we needed to change our core system and regain control of our tech stack. For us, that meant making the change to a new core provider and a new system. We moved to Finastra, a cloud-based core. This was all in the works before Google even showed up on the map.
We did a core conversion that we finished earlier this year. There are probably fewer than 50 banks in the country in a year that will do a conversion because it is the hardest thing you can do in banking. It’s by far harder than an IPO or an M&A deal. It is. There are lots of reasons banks don’t do it, even though they can be highly frustrated with their legacy core providers. It is very, very challenging.
So, we were in the midst of that when we interacted with Google. It’s just one example of the kind of things we can do with the right technology stack and collaboration and partnership with the right groups.
It’s pretty cool for a bank with one location and 60 employees that we can do something like this.
Competing as a community bank
If you’ve been in the industry, or looking at the industry, you’ve seen the commoditization, which is significant over the last 20 years. Just look at the number of banks in the country, particularly community banks, and how that has shrunk. Just in our county alone, where Seattle’s located, we had 22 banks charter in our county. I think it’s like five or six now. From the mid 2000s to today, you see that [consolidation] at the state level, as well. There are just way less community banks because it’s a commoditizing industry.
As a community bank, you’ve got to find ways to safely run your bank, to make a profit and serve your clients. Community banks are incredibly entrepreneurial — they typically have been entrepreneurial on the credit side, whether you’re an ag bank, or doing leasing, or whatever. Now, it is really critical they get innovative with digital on the deposit side.
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