Dive Brief:

• Embedded software banking company Treasury Prime launched its own instant payments rail in March, CEO Chris Dean said in an interview on Tuesday. The payment rail, called OneKey Banking, can be used by fintechs to transfer funds between banks integrated with Treasury Prime’s banking platform.
• Treasury Prime built the payment rail in response to its fintech clients seeking a fast, cheap way to move large amounts of money between banks, Dean said. Traditional transfer options such as automated clearing house transfers took too long to clear and wire transfers were too expensive, he contended.
• “What [the rail] allows the fintechs to do is to move money between Bank A and Bank B in a few milliseconds,” Dean said. “It is a different kind of payment rail than exists anywhere else.”

Dive Insight:

Treasury Prime writes software seeking to simplify how fintech companies connect to banks. Dean said that the company was able to build the payments rail because of its deep integration with the banks’ software systems. It considers both the banks and the fintechs to be its clients, Dean said.

“It is common for a big client to have, let's say three bank relationships,” said Dean, who is also a co-founder of the San Francisco-based company. “So they have money stored at each one of those banks, and they want to move money quickly between each one.”

Dean did not go into specifics about how much money the rail has handled since its launch, saying only that “billions of dollars” were being moved. He contended that fees for using the rail were much lower than those charged by card networks and closer to those associated with ACH transfers, without providing details.

Treasury Prime works with smaller banks such as BankProv, Grasshopper Bank and Bangor Savings Bank. It counts fintechs such as Sydecar, AngelList and Wagestream as its clients, a spokesperson said in an email.

The launch of OneKey Banking came roughly four months before the launch in July of FedNow, the instant payment rail operated by the Federal Reserve. It also competes with the real-time payment network RTP developed by the bank-owned company The Clearing House in 2017.