Santander’s American digital banking platform has surpassed $2 billion in deposits four months after launch.
“This achievement represents a significant milestone in the Santander US business strategy to efficiently boost national deposit acquisition that will fuel its leading auto lending franchise and transform its retail bank,” the Spanish lender said in a Monday (Feb. 3) news release.
The bank introduced Openbank in October of last year. While the service launched by offering high-yield savings accounts, Santander has said it wants it to be a full-service digital bank by the end of the year.
That means offering things like certificates of deposit (CDs), payments and checking accounts, while also expanding its branch network.
“Our aim is to become a national, digital bank with branches and reaching this deposit milestone at record pace is a testament to our customer-obsessed mindset, commitment to innovation, and global connectivity,” said Swati Bhatia, Santander’s head of retail banking and transformation.
“We are uniquely positioned to provide U.S. consumers with the digital banking experience of a FinTech and the strength and stability of a leading global bank.”
PYMNTS looked at some of the challenges involved in digital banking late last year in a conversation with Eric Lee, vice president of product at Amount. He noted that all financial institutions (FIs) face similar challenges in terms of regulations and attracting new customers and deposits.
“Many of these FIs are looking for external help,” Lee said.
Joint research from PYMNTS Intelligence and his company has shown that while most FIs would rate their digital lending processes as good or even excellent, just 1 in 4 banks can actually fulfill their loan processes from application all the way to disbursing funds to consumers and small businesses within the same day.
And just about 36% of financial institutions rely on their digital platforms for more than half of their lending activity.
“Although 70% of consumer lending is done digitally, only a third of their lending is extended to small business customers through online conduits,” PYMNTS wrote “The challenges are more acute for smaller lenders, as they have smaller budgets at the ready, and implementing new platforms and back-end processes can be both time consuming and expensive.”