As the first de novo bank in New England since 2008, New Valley Bank has a unique opportunity to build a customer-centric banking model different than the rest. The start-up, located in Springfield Massachusetts, is on a mission to create a new bank centered around the customer with a strong focus on digital innovation.
“At New Valley, we have the opportunity to create a bank culture that’s different from what other community banks—and even larger banks—are doing. We had a chance to start with a clean slate and pick products carefully to build an ecosystem that was customer-centric,” said Kate Megraw, New Valley chief operating officer and chief information officer. Kate has been in the financial industry for over 10 years and has witnessed firsthand the challenges financial institutions are facing to bring their users the best possible technology.
Focusing on the bank, not the branch
The New Valley mission is to build an integrated branch and digital presence that exceeds consumer expectations and needs. This is a mission founded on experience. “A lot people say that New England is over-banked, but it’s not… it’s over-branched. Most consumers today are picking the best option out of mediocre choices,” said Megraw. Instead of trying to build the biggest physical presence, New Valley’s goal is to build the best customer experience, helping customers thrive no matter where they are.
That’s why New Valley partnered with Apiture. Coming from a world of core-built digital banking technology, Megraw and her team knew that they needed a technology partner, not just another solution. “Though many of the core-provided digital solutions are tried and true in the industry, they’re built on old technology. Features and functionalities are slow to be added, and when they are, they can be clunky,” Megraw commented.
These sentiments on core-provided digital technology resonate throughout the industry. In 2013, the top four core processors owned over 95 percent of the U.S. banking market. Today, that number has fallen to 76 percent. Banks and credit unions are beginning to look elsewhere for technology that fits the specific needs of their users and allows them to innovate and remain agile.
Creating a new experience
As a de novo bank, or a newly-chartered bank that has not been acquired through purchase, New Valley has to focus on shareholder value. One of the biggest ways they’re doing that is by creating a differentiated technology experience. New Valley saw that for the majority of consumers, the digital experience was at the core of their banking relationship. As a result, they decided to focus on how to ensure they were offering the best digital experience in the industry.
Megraw stated, “A lot of competitors are using the same products—their checking and online banking [solutions] are eerily similar. New Valley had the opportunity to do something different and work with a company like Apiture to bring products to the market faster than the competition.”
“We believe in the mission of Apiture,” Megraw stated about New Valley’s choice to use Apiture as their digital banking provider. “We really like the mobile and online products offered today, but we saw the most value in having a partner who will continuously be striving to take us to the next level.”
While there are many exciting opportunities for start-up banks like New Valley, there are also challenges. Many consumers who do not understand what a de novo bank is are still leery to bring their full wallet share to these new banks. This makes acquiring customers a challenging and tireless job. “People wonder about the security of the bank and how much we’ve invested in technology,” Megraw said.
New Valley has been able to auto-enroll their new customers using Apiture. By auto-enrolling, they’re creating quicker adoption and bringing value to new users immediately. “Our customers have already been very complimentary of the online banking experience; they’ve logged in and have started linking external accounts. Being able to auto-enroll customers was a win right out of the gate, and something that isn’t offered by many other digital banking providers,” said Megraw. She continued by saying, “Our customers are enrolling, they’re getting the security they expect and they like the multi-factor authentication. They’ve even commented on the look and feel of the platform and appreciate the My Spending financial management tools offered.”
The circle of trust
Creating trust with customers must first begin with banks trusting their technology providers. While New Valley is still early in their partnership with Apiture, Megraw has been complementary of Apiture’s implementation experience so far, saying, “The implementation has been really stellar. The responsiveness, the attention to detail… nothing has been missed, no timeline has been missed. [Additionally], the access to senior management has been easy and really felt like a two-way conversation.”
For a de novo bank like New Valley, these are the things that matter. When asked to give advice to other de novo financial institutions going through the process of migrating to a more customer-centric banking model, Megraw shared three key takeaways from her own experience:
- 1.) Understand your competition
- 2.) Do your research
- 3.) Be heard by your partners
Megraw further expanded on what she meant in this third point, saying, “It’s so important to us to have that open dialog with [our] partners. It’s critical for us to be able to ask when we’re going to have certain functionality. One of the best things I’ve experienced with Apiture is the transparency. If there’s a product or feature we want, we can have an open conversation and get real feedback,” she said, adding that “Apiture shares what that process looks like and when we can expect our ask to hit the roadmap. As a de novo, that kind of transparency and relationship is invaluable.”
New Valley is continuing to onboard new customers with Apiture after being live for a little over a month. Megraw and the growing team of employees at New Valley are getting ready to launch their first branch location in their hometown of Springfield, Massachusetts, and they’re looking forward to building the digital bank of the future with Apiture.