Customers Bank recasts itself as a partner to crypto, fintech companies


Customers Bank is taking steps to reposition itself as a tech-forward financial institution.

The $19.1 billion-asset bank in West Reading, Pennsylvania, said Thursday that it’s rolling out a new logo and website as well as pouring millions of dollars into digital marketing to cast Customers as a high-tech partner for fintechs, cryptocurrency firms and other technology companies.

Customers is also developing a platform that supports real-time payments for cryptocurrency companies, and it will offer embedded finance and banking-as-a-service to fintechs.

Sam Sidhu, CEO, Customers Bank

“We’ve actually had some of our larger customers come to us and say, your website needs a little bit of work,” says Sam Sidhu, CEO of Customers Bank. “Your [application programming interface] library is great, but your website hasn’t really caught up to where you are in terms of the tech platform that you’ve built.”

It’s the kind of repositioning many community and midsize banks aspire to — a shift from folksy, local bank to an operation with a national, digital presence that can ally, or even compete, with larger tech companies.

The bank stopped short of a name change.

“The name is going to remain Customers Bank, staying true to always putting our customers first and embodying that in our name,” CEO Sam Sidhu said. The bank was called New Century Bank when his father, Jay Sidhu, became chairman and CEO in 2009 and gave it its current name.

Since then, the bank’s logo has been red, white and blue and featured the American flag, representing the American dream.

Customers Bank old and new logos

Customers Bank’s old logo, left, represented the American dream. The new logo, at right, is meant to be modern and tech-forward.

The new logo has overlapping links that resemble a C and a B. Sam Sidhu said the logo could stand on its own on apps and on credit and debit cards, similar to Chase or SoFi.

The bank’s website has also been redesigned based on feedback fromcommercial customers, especially fintech customers, Sidhu said.

“We’ve actually had some of our larger customers come to us and say, your website needs a little bit of work,” Sidhu acknowledged. “Your [application programming interface] library is great, but your website hasn’t really caught up to where you are in terms of the tech platform that you’ve built.”

Customers has 400,000 clients that primarily use digital channels, a combination of consumers and small businesses. Many of the small-business customers were Paycheck Protection Program borrowers.

“They need less of the community bank feel we used to have and more of the 80th-largest bank in the country that we are today,” Sidhu said.

Customers has spent tens of millions of dollars on digital marketing, Sidhu said.

“To acquire digital-first customers, you have to spend money in digital platforms,” he observed. “The brand benefits when you spend that kind of money to acquire customers. I think it will have an amplifying effect over time.”

One impetus for the rebrand is a change that’s coming next year.

Customers will lose the accounts of the users of T-Mobile Money, the app co-created by the telecom company and BankMobile. BankMobile was a digital-only bank started within Customers Bank’s parent company that spun out, merged with a special-purpose acquisition company, went public and recently agreed to merge with First Sound Bank, a Seattle-based business bank.

Customers does hope to quickly get its client numbers back up after the T-Mobile Money loss, but this is not the reason for the rebranding, said Sam Sidhu.

“That plays overall into the way that we’re thinking,” Sidhu said. “It’s not the leading factor. It’s part of the overall strategy, which is to make ourselves more appealing, more accessible to multiple constituencies.”

The bank would consider forging new partnerships like the one BankMobile had with T-Mobile, he said.

Customers is working to become an embedded finance player supporting nonbanks, tech companies and fintech partners.

In one approach, it allows its banking products and services to be delivered to a partner’s customers, on the partner’s platform, and it pays the partner a referral fee. Customers made many PPP loans this way, Sidhu.

Another way Customers would like to engage in embedded finance is if a nonbank wants to offer banking-as-a-service, Customers can provide the infrastructure, risk management and compliance support behind that. In this sense, Customers could end up looking like a bank like Cross River Bank in Teaneck, New Jersey, that sits largely behind the scenes, providing the banking infrastructure support to fintechs like Stripe and Wise.

“The difference that those banks have is they’re all under $10 billion [of assets] and they will stay under $10 billion, because of the Durbin exemption,” Sidhu said, referring to the legal restriction on the amount of interchange income large banks can take on debit card transactions. “So we won’t necessarily compete with them in any of those types of products and services because it doesn’t make financial sense to us.”

Customers Bank is more likely to support fintechs on products like loans that have revenue sources other than swipe fees.

The bank has also been working to appeal to digital-asset companies. It’s building a blockchain-based real-time payments platform with the technology company Tassat for these customers in a partnership that began eight weeks ago. Several cryptocurrency customers have onboarded and are integrating with the bank. Those customers are also bringing their counterparties to the bank.

“It exceeded our expectations of where it would be at this early juncture,” Sidhu said.





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