German savings and investment platform Raisin has acquired Madrid-based Choice Financial Solutions in an effort to integrate with U.S.-based financial providers. Terms of the deal were not disclosed.
Berlin-based Raisin aims to offer U.S. customers a marketplace approach to savings account products through partnerships with financial institutions, a model it’s successfully rolled out in Europe. The company, which intends to launch in the U.S. during the second half of this year, noted that the Choice platform will help client institutions build new products quickly.
“The [Choice] platform enables our partners to quickly create innovative products and distribute them, and we bring additional distribution capabilities through Raisin,” said Raisin U.S. CEO Paul Knodel. “Another capability of the platform is record keeping. We would do all the record keeping on behalf of the bank and then feed data into the bank systems.”
Choice, founded in 2011, developed a technology product that enables financial institutions to efficiently offer savings solutions to the mass market in a cost-effective way. It has worked with a range of Spanish banks, including BBVA USA.
For Raisin, bringing Choice’s capabilities in-house helps boost plans to launch in the U.S. The company, which has not disclosed its U.S. financial institution partners, said it’s had discussions with 40 U.S. institutions, and reactions have been overwhelmingly positive. Raisin’s pitch to U.S users having the ability to choose the best time deposit account that fits their needs and requirements among a wide array of choices. Over time, said Knodel, the company is open to adding investment products to product offerings for U.S. users.
While user accounts will be held by financial institutions, Raisin will handle customer service interactions with customers who acquire their accounts through its platform. Building on its growth in Europe, the company hopes to deliver a compelling proposition to client banks as well as end users.
“We have a strong track record from Europe to deliver value to banks and consumers on our platform,” explained Knodel. “In the U.S., we’re going to bring value to our bank partners through their ability to create new products quickly and with some unique features.”
A financial industry veteran, Knodel previously held senior positions at institutions that include Citigroup, Merrill Lynch, TD Ameritrade and Wealthfront.
Since its launch in Europe in 2013, Raisin has brokered more than $20 billion worth of transactions for more than 200,000 customers in more than 28 European countries. It currently partners with more than 90 banks.
The company, which has raised $220 million in funding, has in recent years made acquisitions to augment the platform’s capabilities, including U.K.-based customer onboarding platform PBF Solutions in 2017, as well as Germany-based MHB Bank and pension startup fairr last year. Its backers include Goldman Sachs, PayPal Ventures, Thrive Capital, Ribbit Capital and Index Ventures.
Michael Stephan, Raisin’s chief operating officer, told Bank Innovation last year that Raisin is uniquely positioned because of its appeal to both end users and client banks.
“We’re very passionate about the two sides of our marketplace,” Stephan said. “We want to make it very easy for [the consumer] to pick and choose, as well as manage, the savings products. We don’t provide a lead out to another bank; we give customer one access point to accounts at a lot of banks.”
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