During the past few years, the U.S. financial services industry has seen a rise in so-called “neobanks,” digital-only financial services providers that eschew the traditional retail banking reliance on physical branches.
According to a report by Business Insider Intelligence, the neobank model first flourished in Europe but has since crossed the Atlantic as many small- and midsized-business owners have complained about the level of customer experience they received from their banks.
Among the new wave of U.S. neobanks is Azlo, an online-exclusive financial services provider aiming exclusively at the small business sector.
“Anyone who lives in the U.S. and does contract work is eligible to be an Azlo customer,” said Cameron Peake, co-founder and chief executive of the San Francisco-headquartered company. “We offer accounts to a wide range of businesses, including sole proprietors, corporations, limited liability companies and general partnerships.”
Azlo”™s strength, according to Peake, is gained by cutting away the various strings that burden many traditional business bank accounts.
“Digital banks like Azlo offer a convenient and free way for people who want the perks of using a business account without the costs and challenges that come with business banking at traditional brick-and-mortar banks,” she continued. “Azlo is the first fee-free digital business banking platform that offers an array of productivity solutions for entrepreneurs, like bill pay, invoicing and other accounting solutions.”
Peake launched Azlo in 2017 and has partnered with several established financial services companies to support its products and services. Its accounts are Federal Deposit Insurance Corp.-insured through its partner bank, BBVA USA.
“Azlo partnered with Kabbage to offer a streamlined way for Azlo customers to apply for and manage loans that are provided by Kabbage,” she said, adding that the bank”™s relationship with Mission Street Capital “accelerates the loan application process and broadens small business access to capital. This partnership with Kabbage is filling a gap in our financial system and enabling small businesses to succeed.”
As for enhancing the customer experience, Peake pointed out that the Azlo customer requires “less than half the time to set up an account compared to other banks.”
She noted Azlo provides its customers fee-free ATM cards that can be used at the 55,000 ATMs in the Allpoint network, and Azlo accounts also include unlimited fee-free ACH transactions. However, customers who want to write out a check will not be able to put pen to paper.
“Azlo does not offer checkbooks,” Peake stated. “However, you can mail a check to anyone through our bill pay service, and you can deposit checks in minutes using our mobile app.”
For her own banking tastes, Peake admitted a fondness for “using digital channels to offer more affordable financial services to people that banks haven”™t traditionally served in the past.” However, she did not envision expanding the Azlo platform to encompass non-business banking.
“As banking technologies continue to rapidly develop, the future of consumer banking is undoubtedly digital,” she said.
