Byline Bank Expands Payments and FinTech Banking Units

Byline Bank is boosting its embedded finance efforts by expanding its payments/FinTech division.

The Chicago-based lender announced in a Monday (May 12) news release that this effort is marked by a series of new hires and leadership appointments.

“This team represents an important evolution for Byline as we continue to invest in innovation and meet our clients where they are,” said Alberto Paracchini, Byline president and CEO. “We’re proud to bring together some of the most experienced FinTech banking professionals in the industry, who not only understand the needs of FinTech founders but also know how to build these programs the right way — with stability, oversight and collaboration at their core.”

According to the release, Byline began upping its efforts in the FinTech payment space last year with the hiring of David Prochnow and Joe Wolsfeld, who were leaders in Fifth Third Bank’s Newline embedded payments division.

The two lead a new team that includes fellow veterans of Fifth Third Bank, as well as MB Financial and First National Bank of Omaha.

The group will offer third-party payment processing for treasury payment flows, issuing and deposit sponsorship banking for virtual card and account programs, as well as network sponsorship banking for independent sales organizations and payment processors.

“These offerings are built on a model of direct oversight, designed to streamline execution without relying on outside intermediaries,” the release added.

In other embedded finance news, forthcoming PYMNTS Intelligence research looks at the calculations made by U.S. middle-market firms when choosing between this funding method and traditional credit options such as applying for loans or lines of credit.

“Embedded financing, a niche alternative, offers a different model,” PYMNTS wrote. “Instead of a separate bank application, it integrates bank and non-bank lending capabilities directly into the digital tools a company already uses, such as its eCommerce platforms, accounting software or invoicing systems.”

Consumers are already using embedded financing products, the report added, as exemplified by things like retail buy now, pay later programs and rideshare payments to Uber via the company’s app or website.

But despite the benefit of speed, embedded financing still hasn’t quite caught on with middle market firms, with many telling PYMNTS they are concerned about the smoothness of the application process and how quickly they can get approved.

“That seeming cognitive disconnect arises even though some banks, citing a less favorable or more uncertain economic outlook, are already reporting increased demand from mid-sized companies for commercial and industrial loans,” PYMNTS added.