German fintech Raisin is making its first foray into the US deposits market with the acquisition of banking software company Choice Financial Solutions.
The acquisition means Raisin will licence Choice’s software to US banks, who can then create customised deposit products for their customers. Raisin declined to disclose what it paid to acquire Choice, which was founded in 2011.
Launched in 2013 in Berlin, Raisin’s savings-and-investments platform enables people to set up one online account and search around for better rates for their savings, then move their money into accounts that offer higher yields, including banks in other European countries.
“Joining forces with Choice Financial Solutions lets Raisin begin offering cutting-edge services to banks and customers before we even launch our US platform,” said Raisin US CEO Paul Knodel in a statement. “Retail consumers increasingly expect convenience in every area of life, and banks today want to meet that demand, not just in terms of online and mobile banking, but also their banks’ available range of products.”
Raisin hired ex-Citigroup and Merrill Lynch executive Knodel to head up its US market entry last year. The startup has raised $200m (£154m) in funding to date—PayPal is one of its biggest investors—and says it has brokered €18.5bn (£15.8bn) for 200,000 customers in over 28 European countries and 90 partner banks since it launched.
“Over the last decade we’ve been able to develop and perfect the ‘missing piece’ for both banks and depositors: customisable deposits for each individual’s needs... with no incremental operational overhead for the financial institution,” said Choice FS founder and CEO Daniel Smith in a statement. “Joining the Raisin family for us means greatly strengthening our ability to scale and connect our software to the sector that needs it most.”
Raisin bought Frankfurt-based MHB Bank last year, for an undisclosed sum, saying it would allow the company to make use of MHB’s banking license to offer its financial services and investment products other eurozone countries in a speedier, more efficient way.