Charitable initiatives are not new to banks.
Many have foundations, donation-matching
programs or standing committees dedicated to giving back. What is new to banks,
however, is how fast they’re being expected to contribute to vital causes while
juggling other time-sensitive priorities created by the Covid-19 crisis.
Launching an impactful, Covid-specific relief program could be a non-starter for banks unless they leverage technology to make it happen quickly. Two Northeastern banks have proved that it’s possible to spin up new products and programs in days with the help of fintech partners.
As the extent of the Covid-19 crisis became
clear, the Community Engagement Steering Committee at The Cape Cod Five Cents
Savings Bank, a unit of Cape Cod Five Mutual Company, kicked its planning into
high gear. The committee includes employees from different areas of the
Before Covid-19 struck, it convened on a
weekly basis to plan community initiatives and review applications for support.
Now, the committee needed to move quickly to help local healthcare
organizations battling the virus on the frontlines. That goal led to a
partnership between the bank and Pinkaloo, a charitable-giving fintech the bank
connected with at an industry event last year.
Pinkaloo had been presenting to the bank’s
internal teams since January, but the arrival of Covid pushed Cape Cod 5, as
the bank is called, to formalize the partnership. “Speed to market was
important to us because of the emergent need,” says Stephanie Dennehy, chief
marketing officer for the $3.6 billion bank.
In a week, the fintech and bank launched giving portals for seven different healthcare providers in the bank’s footprint.
To make it happen, Pinkaloo stayed in close
contact with the bank’s team and everyone – from information security to legal
to executive leadership – worked quickly to streamline the implementation
process. The result was that a vendor management program that would normally
take two to three weeks was completed in two to three days, says Adrian
Sullivan, the bank’s chief digital officer.
Covid has showed banks that they can move fast
in exigent circumstances, but will those lessons last beyond the current
Sullivan thinks they will. “The way we’ve done
things remotely and in such an expedited fashion – I think that becomes new
normal,” he says. “We realized how fast it really can be done, so I think we
will shift for the better and start to work in a more agile fashion.”
To the southeast of Cape Cod 5 is a
single-branch, digital-first bank that’s no stranger to iterating quickly.
Quontic Bank, based in Astoria, New York, chose to support relief efforts with
a new savings account.
The Drawbridge Savings account pays depositors an annual percentage yield of 0.50% on balances up to $250,000; the bank matches the interest paid on these accounts with a donation towards its #BeTheDrawbridge campaign. The savings account approach made sense to Quontic. They didn’t want to rely on a transaction-based account when people are changing their spending habits and stockpiling funds, says Patrick Sells, Quontic’s chief innovation officer.
To make the idea a reality, Sells put in a
call to one of the bank’s existing technology partners, MANTL. MANTL’s account-opening
solution automatically books new accounts to the bank’s core. MANTL engineers
worked through the weekend and delivered the new savings product in three days.
The bank’s team worked all weekend too, preparing disclosures, developing
marketing plans and completing all the other steps required to bring the new
financial product to market.
Although the stakes are higher in times of crisis, the $395 million bank is used to working in an agile manner. “One of the core values that applies here is progress, not perfection,” says Sells. “Striving for perfection so often gets in the way of progress, and especially quick progress.” Quontic can pivot if it makes a decision that doesn’t work, but the bank recognizes it can’t make any decisions when it’s frozen in the planning stage.
Covid-19 is changing the world quickly. Banks that want to help will need to lean on technology to put their plans in motion fast.