SHIFT · US
Regional banks leverage embedded finance and fintech partnerships to capture new deposit flows
Fifth Third, Bancorp, Pathward, and peers are partnering with fintech platforms and embedded-finance providers to attract deposits. Q2 earnings show these partnerships are materializing as measurable balance-sheet growth—new funding source competing with traditional retail deposits.
WHY IT MATTERS
Paradigm shift: deposits now flow through API-first, non-traditional channels. Banks must either build or partner to access fintech user bases. Net-interest-margin compression if deposit costs rise; but diversified funding reduces retail-concentration risk.
Source: PYMNTS · 2026-07-20