We have said a number of times that 2017 is going to be the year of the Fintech/Bank partnership. This announcement today from the American Bankers Association (ABA) fits in very well with that premise.
The ABA announced that they have endorsed the digital lending solution provided by Akouba, a software provider that helps banks deliver small business loans in an efficient manner. This is a coup for Akouba, a startup with 11 employees (according to LinkedIn) that was founded in 2014.
Akouba first came on my radar about a year ago when they applied to PitchIt @ LendIt. They were chosen as one of the eight finalists and they presented to the judges and audience at LendIt USA 2016 this past April. They did not win and I have not heard much from them since that time but clearly they have been getting traction.
A More Efficient Way to Underwrite Small Business Loans
Akouba was conceived because most community banks do not have the capability to underwrite small business loans efficiently. They use old, paper-based methods that make it difficult to underwrite small dollar loans profitably, particularly the sub-$250,000 loans. Akouba provides the technology that converts this paper work flow into an online process from application all the way through funding. They are able to work with the banks underwriting model and incorporate it into this online process.