In a recent interview with Digital Journal, James Yacobucci, Head of Bank Partnerships at Torpago, discussed the role of community banks in the financial services competitive landscape, the challenges they face, and strategies for growth and modernization in 2023. 

Here are six key points he made during the conversation:

1. Importance of Community Banks

James emphasized that community banks play a crucial role beyond being places to deposit money. They are essential to local communities, often investing in local businesses and community projects. Due to their close proximity to customers, community bankers can identify unique needs and offer tailored solutions that larger regional or national institutions may not see or find important. This proximity also better positions community banks to understand their customers' financial goals and needs.

2. Common Struggles Faced by Community Banks

James outlined three core challenges faced by community banks:

• Limited Resources: Community banks often have fewer resources compared to larger competitors, including talent and financial resources.
• Aging Infrastructure: Many community banks have older technology infrastructure, limiting their ability to innovate and offer new products.
• Industry Instability: The industry has faced instability, particularly following bank failures earlier in 2023, which has made it challenging for community banks to retain and attract deposits.
  
  

3. Strategies for Deposit Protection and Growth

James suggested that community banks can protect deposits in the short-term by offering higher yields that track rate increases from the Federal Reserve. However, long-term growth requires investments in people, technology, and products to improve their value proposition for customers. These investments make the bank more attractive to both new and existing customers.

4. How Torpago is Helping Community Banks

Torpago is helping community banks make themselves more attractive by offering Powered By, our white-label commercial credit card and expense management solution. Designed for the needs of community banks and credit unions, our technology helps banks launch new revenue streams, enhance customer experience, and improve operating efficiency. The platform offers features such as an upgraded user interface, card controls, transaction data, fraud monitoring, and underwriting flexibility that banks may be unable to build independently.

5. How Banks Can Work With Torpago

James highlighted the flexibility of Powered By, which lets banks choose how they want to work with Torpago. For banks that want to launch as soon as possible, our fully managed out-of-the-box program gives them a product offering in as little as two months. Banks that want more control can pick and choose the modules and features they want to use, since platform data is available via our API. This approach can take up to six months to implement due to additional integration needs.

6. Technology Modernization Recommendations

James recommended that community banks consider modernization as a strategic imperative. Modern technology not only attracts top talent but also enhances employee satisfaction by facilitating process improvements and growth opportunities. From a customer perspective, integrating and offering the latest technology is essential to remain competitive and expand the bank's footprint. He also stressed the importance of finding a modernization partner to fill technical or talent gaps, making the modernization journey smoother and more effective.

With Powered By

As James shared in his interview, our Powered By solutions were designed to help community banks and credit unions enhance their card and expense management offerings. In addition to providing access to our physical and virtual cards, spend management platform, and mobile applications, we also offer underwriting and marketing support to help our clients drive the adoption of their programs. Learn more about Powered By or request a demo to have us show you how Torpago can help your financial institution modernize your credit card program.