Treasury Prime and Zibo CEOs Discuss How BaaS Makes Launching a Fintech Easier Than Ever

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Headshot of Chris Dean
Chris Dean
Co-founder & CEO
,
May 18, 2021
Treasury Prime podcast: Bank on it, with Chris Dean from Treasury Prime and Chris Hsu from Zibo

Banking as a service (BaaS) isn’t just about supporting niche personal banking tools. It’s about powering fintech products that bring businesses into the now. Our partner Zibo does this by building banking tools for independent landlords, so they can stop scrambling to keep track of business using their personal accounts. 

Zibo offers tools for rent collection (including electronic payments), banking, and insurance, as well as access to loans for landlords seeking to acquire more rental properties. This makes managing money, paying taxes, and growing a rental business easier. 

I chatted with Zibo CEO Chris Hsu on Clubhouse. Here are some highlights.

A simple idea, but with huge potential

U.S. renters pay huge portions of their incomes on rent — up to 45 percent on average in some cities. And 80 percent of that gets paid by cash, check, or money order

What’s holding renters and landlords back from shifting to electronic payments? Part of it is technical capability — independent landlords using their personal bank accounts may not have means set up to receive rent electronically. But Zibo has found that actually renters are very skeptical about electronic payments. They don’t trust them to go through, or they are dealing with traditional banks that put a lot of red tape in the way of sending money through an app. 

As with everything, though, digital payments are where things are headed. 

“My hypothesis is that at least 50 percent of that is going to move online,” Hsu told me. “That is going to make a massive market for what we're trying to do. And we're trying to make it super simple, super secure, and super controlled for a tenant to pay the landlord and for the landlord to accept any form of payment from any bank, from any payment means, and to keep those things all synched up.”

Digital payment is just one of Zibo’s capabilities, but has a big impact. 

It’s easier than ever to start a company like Zibo

Before linking up with Treasury Prime, Zibo spent a year building a solution with another bank partner. But when it came time to go live, they realized what they had built couldn’t deliver the core functionality they needed. They needed something that could enable landlords and/or their tenants to:

  • Deposit checks
  • Issue checks
  • Send payments
  • Collect payments
  • And do ACH transfers

Zibo went looking for alternatives and connected with us through their network. We got the startup set up with LendingClub Bank.

“Within a month of us first meeting, we had a commercial agreement in place to build Zibo on top of your system,” Hsu told me. He said the app was “in market with an FDIC insured financial platform built on banking” so fast,“It's unheard of.”

Zibo waited for a customized card and other special features before launching, adding some time before launch. Treasury Prime’s BaaS platform allows fintechs to go to market in days — basically as soon as they’re ready. 

I would compare the advent of BaaS to the rise of cloud computing. It used to be way harder to start a business — from the basics of incorporating, to buying computers and actually running things. With cloud computing, a startup can plug in with a service like AWS or Azure and quickly launch apps. No need to order hardware and wait.

Launching a fintech with a BaaS platform is the same deal. Services like Treasury Prime remove friction so fintech companies can launch as soon as they know what they want to do.

If you have any questions, feel free to bring them to me directly during my open office hours.

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