Jack Henry™ Announces Banno Business™
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Insights
The introduction of Banno Business by Jack Henry represents a significant strategic development in the financial technology sector. This solution has the potential to strengthen the market position of community and regional financial institutions by offering tailored services that meet the specific needs of small-to-medium businesses (SMBs). By facilitating modern banking experiences, these institutions can enhance customer loyalty and potentially increase market share.
From a market perspective, the ability to provide advanced digital solutions is becoming increasingly critical for financial institutions aiming to compete with larger banks and fintech companies. The adoption of cloud-native banking solutions like Banno Business can lead to operational efficiencies, reduced costs and improved scalability for these institutions. This, in turn, could lead to better financial performance and an enhanced competitive edge.
Investors will likely monitor the adoption rate of Banno Business among community and regional banks as a key indicator of Jack Henry's future revenue streams. A successful rollout could lead to an uptick in software-as-a-service (SaaS) revenues, which are typically characterized by high margins and recurring income. This could positively impact Jack Henry's financials and, consequently, its stock valuation.
It is also important to consider the customer acquisition costs and the time it takes for new products to become profitable. If Jack Henry can leverage existing relationships with financial institutions to streamline the adoption process, the financial impact could be more immediate and significant.
The support of SMBs through advanced banking solutions like Banno Business is not only a business strategy but also has wider economic implications. SMBs are often cited as the lifeblood of the economy and their growth is essential for job creation and economic diversification. By providing SMBs with better financial tools, community and regional financial institutions may play a pivotal role in fostering local economic development and stability.
Furthermore, the increased access to capital for SMBs through improved banking services could lead to an uptick in entrepreneurship and innovation within communities. This could generate a virtuous cycle of economic growth, with potential positive effects on local employment rates and overall economic health.
Cloud-native business banking solution enables community and regional financial institutions to better support businesses throughout stages of growth
Community banks and credit unions are well-positioned to support SMBs because of their knowledge of the community and focus on financial health. They have proven to be a backbone of their community, providing SMBs with access to capital when they need it the most. According to the Independent Bankers Association (ICBA), community banks provide the majority of small business loans. Banno Business will further equip community banks and credit unions to serve businesses in their communities with competitive, advanced digital tools embedded into the Banno Digital Banking Platform™.
High Plains Bank is utilizing Banno Business to help win more SMBs with first-to-market services and grow its deposits while improving the financial health of local businesses. "The features of Banno Business surpass what we see from banks of any size and enable our community bank to compete with anyone in the market," said Brian Otteman, chief experience officer at High Plains Bank. "Business owners can easily manage permissions for their employees, simplify their money movement, and understand their cashflow. These are critical tools to empower our community business owners and strengthen our bank."
Banno Business helps financial institutions serve SMBs by packaging business solutions (including cash management, payments and commercial lending) with new embedded payment capabilities, cash flow tools, reporting, and advanced features for business owners to control their finances. Businesses can also link external accounts to their financial institution through integration with Finicity from Mastercard, gaining a complete view of their finances in one place.
Freedom First Credit Union is also launching Banno Business to further embed itself into its community. Paul Phillips, President & CEO of the credit union, commented, "We want to be the reliable partner that our members trust to help in all aspects of their financial lives, including their businesses. Having a full business solution with the digital user experience that our members know and trust makes for an easy transition into new markets. Banno Business positions us to mature existing member relationships and grow net new business; it's a win for our deposit acquisition strategy and diversifies our portfolio."
"Banno Business centralizes the business banking capabilities and partnerships we've created over the years into a single platform," said Julie Morlan, Managing Director of Digital Solutions at Jack Henry. "We've built our platform to be highly configurable and scalable, enabling banks and credit unions to compete across the business spectrum. With Banno Business, financial institutions can expand and monetize their market share – a
Banno Business leverages the success of the Banno retail platform, which has more than 10.5 million registered users. The solution is part of the company's technology modernization strategy, which provides cloud-native services that can be bundled together to solve key business challenges.
About Jack Henry & Associates, Inc.®
Jack Henry™ (Nasdaq: JKHY) is a well-rounded financial technology company that strengthens connections between financial institutions and the people and businesses they serve. We are an S&P 500 company that prioritizes openness, collaboration, and user centricity – offering banks and credit unions a vibrant ecosystem of internally developed modern capabilities as well as the ability to integrate with leading fintechs. For more than 47 years, Jack Henry has provided technology solutions to enable clients to innovate faster, strategically differentiate, and successfully compete while serving the evolving needs of their accountholders. We empower approximately 7,500 clients with people-inspired innovation, personal service, and insight-driven solutions that help reduce the barriers to financial health. Additional information is available at www.jackhenry.com.
Statements made in this news release that are not historical facts are "forward-looking statements." Because forward-looking statements relate to the future, they are subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to, those discussed in the Company's Securities and Exchange Commission filings, including the Company's most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Any forward-looking statement made in this news release speaks only as of the date of the news release, and the Company expressly disclaims any obligation to publicly update or revise any forward-looking statement, whether because of new information, future events or otherwise.
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SOURCE Jack Henry & Associates, Inc.
FAQ
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