Blend, the leading platform for digital banking solutions, has officially announced a partnership with Astra, an industry-leader in instant payments-as-a-service, to enhance the digital onboarding experience for consumers who are looking to quickly and seamlessly fund their new deposit account. To understand the significance of such a development, we must acknowledge that among the most common challenges preventing consumers from funding their deposit account within a single session is the lack of optionality and convenience in funding methods. Now, over the past, ACH transfers have been the primary method for such a job, but as digital payment methods evolve, banks and credit unions have increasingly started to offer debit card funding as a more convenient and user-friendly alternative for consumers. You see, by eliminating the need to find and enter routing and account numbers that have long remained associated with ACH transfers, debit card offers the prospect of a quicker and more seamless account funding process, enabling consumers to seamlessly activate new accounts for use in a single session. Another reason why debit card presents itself a more viable option here is rooted in the way consumers with limited funds face a higher risk of overdrawing their accounts when using ACH. This, in turn, can unnecessarily lead to extra fees, but fortunately enough, debit card help you avoid the stated risk by only allowing transactions up to the available balance. Furthermore, debit card transactions typically also result in immediate or near-immediate access to funds, while on the other hand, ACH transfers can take a few days to process.
“Today consumers expect a frictionless, real-time product experience, and that starts at account opening,” said Gil Akos, Co-Founder and CEO of Astra. “Financial institutions and fintechs need to deliver a best-in-class onboarding flow to win new customers – instant account funding is the perfect solution, leading to improved activation rates of 30% or better on day one. We’re proud to partner with Blend to offer this experience to their customers.”
Having referred to the overarching benefits, we must now turn our attention towards how this switch from ACH to debit transfers will shake out in the context of Blend-Astra’s partnership. In essence, by integrating Astra’s Card to Account payment solution directly within Blend’s Deposit Account application flow, the collaboration will enable Blend customers to generate digital engagement beyond just the initial application capture; helping to reduce abandonment rates and increase the speed it takes for consumers to complete an application. Internal support teams, in particular, also stand to gain here, as they have to put up with less manual outreach. Not just that, they will have the facility to follow-up to get accounts fully funded, while simultaneously enjoying deep customer relationships.
Making the whole development even more important is, of course, Blend’s vast customer base (which includes 140 of the top 1000 depository institutions by deposit assets as of Q2 2024), a database which claims that card funding has become one of the most popular options selected by consumers when opening up a new deposit account. This becomes evident upon considering that one of the nation’s largest credit unions by asset size, and also a Blend customer, reported that 82% of their new deposit accounts were funded using Astra card funding, significantly outpacing four other available funding methods. Another Blend customer and also one of the top 100 largest credit unions in US would go on to show that 66% of consumers prefer Astra Card funding over other funding methods.
As for the new solution’s availability, card funding for Blend Deposit Accounts is now generally available for all customers, with the activation timeline ranging from 2 to 3 weeks.
