Temenos (SIX: TEMN), a banking platform provider, has expanded its relationship with Mbanq to boost its Banking as a Service (BaaS) in the US. At the same time, Temenos has invested in Mbanq, taking a minority stake in the Fintech. Temenos did not immediately reveal the size of the equity position.
Temenos stated that the updated arrangement with Mbanq builds up the joint “Credit Union as a Service” relationship previously established.
Temenos said the move was designed to benefit from the “explosive growth” of embedded finance which is predicted to increase to $17 trillion by 2030.
The US is one of the fastest-growing BaaS markets in the world. Mbanq focuses on platforms across a number of sectors, such as Ivy League Universities, sports teams and more. As banking services move to become ubiquitous, Mbanq offers a service like branded deposit programs and debit cards, credit cards, lending, etc. Furthermore,
Temenos banking platform, combined with Mbanq’s technologies, aims to bring to market a differentiated BaaS proposition for Fintechs and brands that are modern and compliant.
Temenos added that the partnership opens up the opportunity to target mid-sized banks in the US, enabling them to not only launch BaaS services such as deposits, credit cards or BNPL, but also future-proof their technology stacks.
Max Chuard, Chief Executive Officer of Temenos, commented:
“We are excited to expand our strategic partnership with Mbanq and deliver an end-to-end BaaS technology proposition. This move will extend Temenos’ target addressable market by opening up a new channel to offer BaaS services directly to consumer brands, an incremental market to our business. Temenos is offering a unique end-to-end BaaS proposition, which can power the technology needs of all BaaS ecosystem participants. Together with Mbanq we bring to market a unique combination of capabilities in embedded finance underpinned by broad and massively scalable functionality, combined with value-add services such as regulatory and compliance. Mbanq and Temenos have the opportunity to deliver this, and the increased and accelerated investments from both parties will leverage this market momentum. I expect this partnership to become one of the key sources of growth for Temenos in the very important US market.”
Vlad Lounegov, Chief Executive Officer, Mbanq, called the partnership “game changing” that will not only drive his company’s growth but will transform regulated as well as unregulated entities, to offer embedded finance.