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Community banks are vital in supporting local economies and providing financial services directly and indirectly to underserved small businesses and consumers. However, community banks’ reliance on legacy technology systems has historically limited their ability to deliver leading-edge products to their customers.
Banks and credit unions for years have employed AI to reduce fraud, and they are increasingly doing so today. A recent survey by the identity security company Alloy found that 59% of financial service companies are looking to invest in machine learning and AI-powered models to deter fraud over the coming 12 months.
A new consortium led by a venture capital firm, an alternative asset manager and a few large community banks is addressing that problem. The group believes it can help community banks adopt the technologies they need with less cost and risk by pooling resources and fostering collaboration between banks and fintech startups.
The strategic partnership, which announced its launch on Wednesday, was formed by institutional alternative asset manager Elizabeth Park Capital Management, venture capital firm Strandview Capital and an unnamed number of community banks. The consortium will operate an investment fund for technology companies that focus on community banking. The Btech member banks will be limited partners.
The Btech Consortium announces the launch of a strategic technology partnership between U.S. community banks, Elizabeth Park Capital Management, and Strandview Capital. The mission of the Btech Consortium is to empower community banks to compete more effectively with larger money-center banks, decrease their constraints due to legacy technology, and serve their local communities better.
24/7/365 payment capability. Increasingly it’s important to move money quickly, efficiently, and accurately. The ability to offer payment specialization is an excellent way for banks to gather deposits and provide their customers with a competitive advantage.
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