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Digital banking tech startup Narmi raises $20.4m

Source: Narmi

Narmi, a leading financial technology company that builds digital banking solutions, today announced the close of a $20.4M Series A funding round to empower community banks and credit unions to go to market faster and better compete with megabanks, challenger Banks, and fintechs.

New Enterprise Associates (“NEA”), one of the world’s leading venture capital firms, led the investment round with participation from over a dozen investors including Patriot Financial Partners, Picus Capital, Contour Ventures and Firebolt Ventures. Executives from Plaid, Brex, Expanse and other leading companies also invested in the round.

Narmi’s mission is to offer the most seamless, thorough and open digital banking platform in the industry. Its API-driven and entirely cloud-based platform allows financial institutions to use any of Narmi’s platforms (digital account opening, consumer digital banking, business digital banking and an administrator console) to drive growth, deposits and cost efficiencies. Key pillars of the Narmi platform include complete openness via its API, Application Framework, and AppXchange; strong integration with leading core banking systems and a seamless experience between account opening; and digital banking for both consumers and businesses.

“Businesses and consumers are doing more of their banking online than ever before, and the ability to connect financial institutions with their end customer in faster, simpler, digital-first ways has never been more important,” says Liza Landsman, General Partner at NEA. “Narmi is delivering an unparalleled product that shows a deep understanding of the challenges that regional banks and credit unions are facing to keep pace with an increasingly digitally-centric customer base in banking today, at a speed that is super impressive. We are very proud to partner with them on this journey of continued innovation and success.”

Digitization of the banking sector has accelerated at unprecedented levels, yet digital banking platforms remain antiquated and closed. Consumer expectations have rapidly evolved with the rise of fintechs, and COVID-19 has only accelerated this trend. With many branches closed during the initial outbreak of the pandemic, more than 50 percent of US consumers increased their online banking usage during the pandemic. Research from BAI also found that 87% of them are planning on maintaining this usage after the pandemic. Similarly, businesses felt the need for better business banking platforms with the rollout of the Paycheck Protection Program (PPP). Based on overwhelming demand from customers, prospects and industry partners, this partnership and capital infusion will enable Narmi to expand current offerings to banks and credit unions servicing hundreds of millions of Americans.

“We started Narmi with the mission to help financial institutions thrive in a digital-first world and that mission hasn’t changed. Since launching over four years ago, we’ve experienced over 100 percent revenue growth every year, launched four enterprise-grade platforms and helped our partner financial institutions deliver transformational results,” said Narmi Co-Founder Nikhil Lakhanpal.

“Narmi has been paramount in helping us put technology at the core of the bank. In timelines that are 50-75 percent faster than our competitors, we were able to launch an award-winning online and mobile banking experience that has ensured cost-effective deposits and customer growth. We doubled down on our relationship with Narmi with their industry-leading business digital banking platform to support our surge in new business clients seeking a better banking solution as a result of the pandemic,” said Mike Butler, CEO of Radius Bank. “The Narmi team continues to impress us with their speed and innovation. We look forward to our continued partnership with the Narmi team as they grow.”

Narmi customers, which include Radius Bank (voted Bankrate.com’s #1 online bank and Nerdwallet’s best online banking experience) and digital account opening customer Berkshire Bank (won Tearsheet’s best onboarding program) have all achieved outsized results. Examples of this success include:
• 4x the industry average for digital account opening completion rates
• 50 percent decrease in support volume related to digital services
• Over 99 percent decrease in fraud at account opening
• 78 percent increase in ACH transfers over a 9 month period
• 100 percent automated decisioning of digital account applicants

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