Optimizing Banking Infrastructure for Better Services

Optimizing banking infrastructure is crucial for providing better services to customers. This can be achieved by implementing digital transformation strategies.

A well-designed core banking system can significantly improve operational efficiency. It can also enhance customer experience by providing seamless and secure transactions.

For instance, a study found that banks that invested in digital transformation saw a 25% increase in customer satisfaction. This is a significant improvement that can be attributed to the efficient use of technology.

To optimize banking infrastructure, banks must prioritize data security and compliance. This can be achieved by implementing robust security measures and adhering to regulatory requirements.

To establish a county infrastructure bank program, you'll need to follow a series of steps. The typical steps for establishing a county infrastructure bank program are as follows:

It's essential to work with a consultant that possesses dual expertise in civil engineering and financial consulting to help with these steps. This consultant can help you navigate the process and ensure that your program meets its long-term infrastructure goals.

With an infrastructure bank program, you can get to market quickly, thanks to Unit's White Label App, which can get you started in just a matter of weeks.

Unit has helped nearly 200 leading platforms and marketplaces launch and scale their embedded-finance programs, which is a testament to the effectiveness of their solution.

One of the key benefits of using Unit is that they offer a complete product with a modern, best-in-class UI, which includes features like same-day ACH, check deposits, recurring payments, and fee-free ATMs.

This means you can provide your customers with a seamless and convenient banking experience, which can drive adoption and growth.

Unit partners with multiple banks, which enables them to offer easy migrations and the most complete suite of embedded financial products.

This flexibility is particularly beneficial for tech companies that want to offer a range of financial products to their customers without having to manage multiple bank relationships themselves.

Unit's compliance leadership has decades of experience in the traditional financial services industry, which means they can provide industry-leading compliance and oversight to their customers.

This is a significant advantage for tech companies that may not have the necessary expertise or resources to manage compliance on their own.

Unit facilitates the underwriting process, which means they can help determine who to lend to, how much, and on what terms, taking the burden off tech companies.

This can be a significant relief for companies that may not have the necessary resources or expertise to manage underwriting.

Unit provides access to capital to support lending programs, which means tech companies don't have to use their own funds for this purpose.

This can help preserve company resources and reduce financial risk.

If you're a tech company looking to launch embedded financial products, you have two main options: working with a bank partner without an embedded-finance platform, or partnering with a platform like Unit.

Working with a bank partner without a platform can take up to 2 years and cost $2 million, as you'll need to build all the necessary banking technology from scratch and assemble a large compliance team.

You'll also need to find a bank partner, which can be a lengthy process, as there are over 4,500 banks in the US, but only 30-40 have a track record of successfully partnering with tech companies.

Here's a comparison of the two options:

Partnering with an embedded-finance platform like Unit can bring your embedded financial products to market in a matter of weeks, and you won't need to hire a large, dedicated banking team.

With Unit, you can get started quickly, as they provide a complete product with a modern, best-in-class UI, and they'll introduce you to several potential bank partners that match your goals, target audience, and use case.

Unit also offers industry-leading compliance, underwriting, and capital to support your lending programs, so you don't have to worry about these complex tasks.

Ultimately, choosing between these two options depends on your company's resources, timeline, and goals, but partnering with an embedded-finance platform like Unit can help you launch and scale your embedded finance program more efficiently.

A county infrastructure bank can be a sustainable source of funding, creating a never-ending funding source that replenishes itself as municipalities and private organizations repay their loans.

This funding model is made possible with a small up-front investment in program set-up and annual set-aside funding to subsidize the interest on its loans.

Loans from a county infrastructure bank are more flexible and affordable for municipal recipients, offering interest rates as low as 0.5% - lower than any other available loan program.

The terms of the loan can be adjusted to meet the needs of the project and the loan recipient, covering the entire cost of the project, including administrative oversight, design fees, and construction.

By taking ownership of project delivery, the county ensures the project is completed efficiently, maximizing the value its dollar provides.

The economic and IT aspects of banking infrastructure are closely intertwined. A well-designed infrastructure bank can promote economic development by providing funding for projects that address infrastructure needs, such as water or sewer extensions, traffic access, or capacity issues.

The county can target its funding to long-term strategic goals by crafting these goals into the selection criteria for the loan. This ensures that money is available to address roadblocks and allow progress to occur.

Banks are also evolving their IT infrastructure to meet the changing needs of consumers and businesses. Modern banking IT infrastructure is incorporating technologies like automation, machine learning, big data, and analytics to provide a competitive edge and make customers happy.

These technologies include analytical platforms for personalized services, open banking APIs, combining online applications with in-person branches, and leveraging online helplines.

Banks are working on strategies to ensure their profitability and long-term success in a digitally aware world.

Modern consumers and businesses expect more from their banks compared to just a few years ago. We’re all more digitally aware, and we expect our banks to keep up with that.

Banks have a wealth of data, but much of it is stuck in old systems and can’t be fully utilized. However, as banking IT infrastructure advances, the situation is changing.

Technologies like automation, machine learning, big data, and analytics are becoming part of the IT infrastructure, allowing financial institutions to use them for a competitive edge and to make their customers happy.

Here are some examples of how banking IT infrastructure is evolving:

With the right banking IT infrastructure, banks can provide a personalized experience that builds relationships and turns customers into advocates.

Infrastructure plays a crucial role in promoting economic development. By providing funding for essential infrastructure projects, the infrastructure bank helps to overcome roadblocks that might otherwise hinder progress.

New developments often struggle to move forward due to infrastructure needs like water or sewer extensions, traffic access, or capacity issues. This can be costly and time-consuming, but the infrastructure bank helps to alleviate these concerns.

The county can target its funding to long-term strategic goals by crafting these goals into the selection criteria for the loan. This allows them to prioritize projects that align with their economic development objectives.

Applicants can be required to explain how their project will promote economic development, address safety deficiencies, or benefit under-served populations in rural or low-income areas.

To set up a county infrastructure bank program, you'll need to identify unmet infrastructure needs and do some high-level planning. This will help you determine the scope of your program and what kind of projects to prioritize.

Typically, the first step is to identify a county funding source and the amount to invest into the program. This will give you a solid foundation to work from and help you determine how to proceed with the rest of the program.

To find the right funding sources, you'll need to identify capitalization funding sources that are compatible with your county funding and project types. This might involve working with a consultant who has expertise in both civil engineering and financial consulting.

Here are the typical steps for establishing a county infrastructure bank program:

To set up a county infrastructure bank program, you'll need to follow these key steps. Identifying unmet infrastructure needs and high-level planning is the first step, which involves assessing the county's infrastructure needs and creating a plan to address them.

To determine the amount of funding needed, you'll need to identify a county funding source and the amount to invest into the program. This could be through a combination of local and external funding sources.

The next step is to identify capitalization funding sources that are compatible with the county's funding and project types. This might involve exploring public-private partnerships or other innovative financing options.

Developing financial models is crucial to determine program parameters, such as loan terms, rates, fees, and more. This will help you create a solid foundation for your infrastructure bank program.

To gauge interest from local municipalities, you'll need to develop an educational outreach program. This will help you understand which municipalities are interested in participating in the program and how they can benefit from it.

Here are the typical steps for establishing a county infrastructure bank program:

If you're planning to launch an infrastructure bank program, you have a few options to consider. A consultant with dual expertise in civil engineering and financial consulting can help you identify funding sources and plan for long-term infrastructure goals.

There are two main approaches to launching embedded financial products: working with a bank partner without an embedded-finance platform, or using a platform like Unit. The latter approach is preferred by 95% of tech companies due to its faster time-to-market and lower resource requirements.

If you choose to work with a bank partner without a platform, you'll need to find a bank that has a track record of successfully partnering with tech companies. There are only 30-40 banks in the US that fit this criteria, so be prepared to speak with at least 10 banks before finding a good candidate.

To build a banking technology stack, you'll need to invest in ledgers, banking statement generators, KYB/KYC flows, information security, reconciliation, reporting and data access, card issuing, interest calculations, and connectivity to payment networks. This can take up to 18 months and requires specialized engineering, product, and business talent.

Here's a breakdown of the costs associated with building a compliant banking operation without a platform:

Overall, launching embedded financial products without a platform can be a costly and time-consuming endeavor, requiring at least 2 years and $2 million of investment.

A county's infrastructure bank program should have a formal application and competitive selection process to ensure that the most critical needs within the local community are addressed.

The selection criteria should consider various factors, including the impact of a project on economic growth, whether safety improvements are achieved, and whether traffic accidents will be reduced.

Smaller municipalities are given higher priority since they need a program like this more than larger metropolitan areas that likely have more resources.

The county will use these selection criteria to ensure its strategic planning goals are met with the funds it disburses.

Each project should move the county forward in terms of promoting safety, economic development, and quality of life.

Counties can ensure the loans they make are paid back by requiring a credit check and some sort of collateral.

For instance, Dauphin County requires municipal recipients to pledge their Liquid Fuels allocation, and private entities must provide a letter of credit.

The county can further protect its investment by managing the bidding and construction process.

The following types of organizations can apply for a loan from the county's infrastructure bank program:

In fact, the county itself can apply for funds in the case of an emergency or unforeseen circumstance.