While Column is unique in the breadth of services it provides, Hockey’s venture is positioned against other, established chartered banks already running the back ends for billion-dollar fintech firms (think Stripe and Square). Three years ago we set out to fix this, starting from first principles and building a bank from the ground up.” A growing fintech trend “Financial services needs to be consumer, developer and internet first however, in order to do this it needs a new backbone. “I’ve spent time with (literally) thousands of companies building in financial services and it is painfully obvious that the biggest bottleneck to their growth and innovation is the underlying banks they rely on,” Hockey, who serves as co-CEO of Column with his wife, Annie, said. Or they can become an originating partner, offering products for debt financing and loan repurchase. With Column, a fintech can launch a debit or credit program with any issuer processor. A tiny operation, NorCal only has a single physical branch in Chico, California, and the day-to-day operations of the bank remain separate from Column. Peeling back the curtains, Column is a rebranded community bank - Northern California National Bank or NorCal - that Hockey purchased for $50 million last year. Developers can use Column to build apps that pull and push money to any bank account, for example, or maintain FDIC-insured checking and savings accounts. “This leads to unclear responsibility and ownership unnecessary costs.”īy contrast, Column, a nationally chartered bank with a direct connection to the Fed, has an in-house ledger and data model to power various fintech services. There is an unnecessary separation between the chartered regulated bank and the middleware and platform companies that fintechs rely on,” Hockey said. “The largest pain point in building in financial services and fintech is the supply chain it’s built on. And this can lead to a poor customer experience. Unfortunately, the systems between fintechs, vendors and banks can be rigid and expensive. But the process is often fraught, making a partnership with banks an easier pill to swallow for most fintechs. Varo in 2020 became the first consumer fintech to be granted a national bank charter. Nonbanks can apply to be an industrial loan company, or ILC, which allows them to issue loans and accept federally-insured deposits. (Robinhood in 2018 ran afoul of regulators for lacking the proper insurance to offer a checking account.) Federal Reserve controls - a steep ask for a nonbank. The reason? Because companies need federal deposit insurance in order to access the payment system the U.S. For years, fintech companies have had to work through middleware vendors (e.g., Modern Treasury, Synctera, Sila Money, etc.) and core processors (FiServ, Jack Henry and FIS) that wrap legacy sponsor banks to deliver products like wire transfers, check processing and loan origination.

“We are both the bank and the technology provider.” A developer-focused bankĬolumn emerges from stealth today to - if Hockey’s pronouncements are to be believed - turn the fintech industry on its head. “ a nationally chartered bank but have built every facet of the technology from scratch,” Hockey told TechCrunch in an email interview. To rephrase, Hockey founded a bank called Column. But he’s been anything but idle, quietly creating the platform for what he believes is the first bank of its kind: a “financial infrastructure” bank.

Hockey has kept a low profile since, maintaining a seat on Plaid’s board as the company, now valued at $13.4 billion, builds out its global finance network. Having helped to grow Plaid into a multibillion-dollar business with fellow co-founder Zach Perret, Hockey left for other pursuits and to - as he put it in a June 2019 tweet - make room for more “great leaders.” In 2019, William Hockey, the co-founder of fintech business Plaid, announced that he would step down from his position as Plaid’s chief technology officer and president.

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