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BaaS is the best path forward for community banks


Community banks are vital. According to the Office of the Comptroller of the Currency, “These institutions play a crucial role in providing consumers and small businesses with essential financial services and a source of credit that is critical to economic growth and job expansion.”

But they’re also under duress, and there aren’t that many paths to survival: hold the course, sell, or reposition.

Unlike most low- to middle-market companies, banks’ possess a key competitive advantage in their charter, which is why we think repositioning themselves to offer partner banking services (often referred to as Banking as a Service, or BaaS) in addition to serving their local communities could be the most advantageous path forward - but it won’t work for all community banks. Thanks to The Financial Brand for giving me the opportunity to share some thoughts on when and why repositioning makes sense, and what banks need to have in place if they’re contemplating it.

And if you need help with developing or implementing a partner banking strategy, get in touch with Klaros. Helping banks and fintechs partner to meet the banking needs of their customers is our business.


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