Portland has long been known as the "Silicon Forest," home to a host of home-grown champions of the tech (especially open-source) world. Along with Google and Square testing their new payments-revolutionizing technology here, a small Portland firm that opened in 2009 might help the Silicon trees grow deeper financial roots.
BankSimple, founded by CEO Josh Reich, CFO Shamir Karkal, and CTO Alex Payne, is not a bank, but plans to take consumer banking by storm with the release of its all-in-one web-based money management system. It has partnered with processors like Visa and banks like Bancorp and Allpoint to allow consumers to integrate all of their personal financial in one web-based and mobile-accessible interface. Unlike the websites for major banks in the US, which only 53% of Americans believe provide quality service, BankSimple's technology is designed from the ground-up to optimize customer-experience, rather than designed to interact with a decades old banking system. While it won't hold deposits, BankSimple will automatically forward savings into FDIC-insured partners, and provide a streamline proxy through which the customer gets real-time information and can keep easy notes on transactions at the time they take place through their smart phones.
In a recent blog post on the company's website, Reich announced that the firm has received another round of funding worth $10 million. This means great news both for consumers and for Portland. Consumers get a much needed re-invigoration of the consumer finance sector. Portland gets a significant investment in a growing business that provides high-quality, skilled work for our community members. We applaud both these trends enthusiastically.
The only question we have (and it's only a question) is how this system will look to our primary clients, the merchants. We hear that BankSimple intends to make a significant amount of its revenue from debit card fees charged to merchants on the cards that BankSimple users spend their funds with. Will this be another continuation of the now 40-year trend of making finance simple for consumers, but leaving small businesses to clean up the mess? We certainly hope not. And we have great faith in our fellow Portlanders to make a product that improves finance for everyone.
Matthew Koren is the President of Priority Payments Northwest, a credit card processing and payroll service provider located in Portland, OR. He runs his company, as well as partnering with a consulting practice: Causeit, Inc. You can contact him by filling out the Contact Us page, or by calling 503-548-6312, ext 750.