TEL AVIV – For all the talk of banks going digital, few major brands have launched digital offshoots — in the U.S., that is.
There is BankMobile, launched from Wyomissing, Pa.-based Customers Bank, and that’s about it.
In Europe, there are more examples — two prominent ones are Hello bank! from BNP Paribas, and ImaginBank from La Caixa.
Another example will launch before the end of 2016 — Pepper, from Israel’s Bank Leumi. Leumi, whose name means national bank, is Israel’s largest bank as of 2015, with approximately $104 billion in assets.
Chosen to lead Pepper was Lilach Bar David, a veteran of Leumi Card, a payment card subsidiary of Bank Leumi. David spoke at Bank Innovation Israel last week in Tel Aviv, and explained plans for Pepper’s upcoming launch.
Pepper will rely solely on digital advertising for now, using as its primary channels Google and Facebook. Conventional advertising may be considered in the future, but for now the bank’s target demographic of Israeli millennials can be effectively reached most effectively via these digital channels, David said.
Other countries may be considered, most likely in Europe, but for 2017, at least, Pepper will focus on Israel.
“The U.S. has too many existing products,” David said, referring not just to BankMobile but to neobanks such as Moven, Simple, and GoBank.
Pepper is launching with a lending product, similar to BankMobile but unlike the other neobanks listed above. Its onboarding process takes in enough information to underwrite loans purely on the mobile platform. Partnerships, for example with marketplace lenders, may be considered down the road, but are not currently a priority, David said.
That’s because, backed as it is by Bank Leumi, it has extensive in-house expertise and technology. It is, however, built on a new modern tech stack that users of legacy banks might envy.
A corresponding payments app called Pepper Pay will also launch later this year. David expects more rapid adoption of Pepper Pay, which allows P2P transfers, than the full-service banking app.
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