Quarterly equity funding for insurtechs has settled at $1.0 billion in Q3, a 17% drop from Q3 2024 according to CB Insights. Investors have grown more selective, focusing on B2B insurtechs that offer a faster path to profitability than their consumer-facing counterparts. The quiet winners in insurtech are now B2B, focusing on supporting other players with underwriting, claims management, and operations infrastructure. These firms are reshaping the industry from the back end rather than trying to disrupt it head-on.
Eighty-three percent of US consumers would switch insurance carriers due to a poor claims experience, per Invoice Cloud’s 2025 Consumer Claims Experiences Survey. This suggests that claims interactions, while rare, are make-or-break. Relationships between insurers and insureds are traditionally very sticky—insurance is a “get it and forget it” product, with most customers only interacting with their carrier at purchase and at claim. That makes claims one of the few moments where customer loyalty is actually tested.
The White House issued an executive order reclassifying cannabis from a Schedule I to a Schedule III controlled substance—a lower-risk category that puts it on the same plane as some controlled prescription medications. The US legal cannabis industry is worth $35 billion and served by at least 800 FIs. Even if Congress follows through as cannabis is reclassified as a lower-risk substance, banks will likely be slow to get involved. Enhanced due diligence and reporting requirements are in force until further notice, and being in the cannabis business has a stigma among banks regardless.
Truist has added a direct deposit switching tool to its consumer digital account opening flow using technology from Atomic. The feature lets customers move their payroll deposits from another financial institution (FI) to Truist during onboarding. Creating a direct-deposit relationship is a well-worn path to primary FI status. It positions FIs to retain customers and cross-sell higher-value, advice-driven products. FIs that transform direct-deposit switching from a paper-based process to a few clicks will find that customers are immediately stickier.
UK neobank Monzo has agreed to acquire online mortgage broker Habito as it expands its homeownership features—including tracking and brokering home loans—in its app. Neobank super apps create unique banking journeys that engage customers based on different needs as their financial lives progress. With an integrated mortgage broker, Monzo ties together its home insurance product and mortgage-tracking feature—and could debut a direct mortgage product in the future.
SoFi launched the SoFiUSD stablecoin on the Ethereum blockchain. The bank will also provide infrastructure that lets other banks and fintechs issue white-label stablecoins that are interoperable with SoFiUSD. “Stablecoins as a service” like SoFi’s offering—and Fiservs’—may democratize stablecoins to a broader base of financial institutions. Up until now, banks that wanted to issue stablecoins needed to develop their own decentralized finance (DeFi) infrastructure and internal compliance guardrails. A widespread entry into stablecoins would be a massive pivot for a banking sector used to dealing in fiat currency, normalizing stablecoins as a payment mechanism across the US—further blending traditional finance and DeFi.
Amazon has partnered with the fintech Slope to offer AI-underwritten financing to Amazon sellers and reduce friction in the lending process. Eligible US Amazon merchants will be able to apply for and access loans through their seller accounts. Amazon could position itself as the go-to platform for higher-volume sellers as well as a more sophisticated alternative to financial institutions—and compete aggressively based on accuracy of underwriting and the time between applications and loan funding. It is the wise move for banks to move into embedded lending for ecommerce rather than try to sell loans to these merchants directly.
Wells Fargo plans to renovate more than half of its branch network by the end of 2025 in large metro areas as well as in rural markets—and more are in line for 2026. The new design features interactive tools that support customer education with mobile and online banking. The pandemic dealt a blow to the branch as a channel, but its decline distracts from its changing role. Making branch networks more efficient means customizing services to the communities where they’re located, optimizing the design for customers whose banking behaviors emphasize digital services.
UK digital bank Starling is exploring an acquisition of another UK lender, per the Financial Times—in addition to a US bank. The move could help it expand quickly into corporate lending. Starling is not the only foreign neobank with US plans. Revolut, which competes with Starling globally, has held talks with investment bankers about buying a bank to secure a US license. Brazil’s Nubank applied for a US bank charter in October. But barriers to entry are rising as US challenger banks mature. Given the challenges ahead, quickly growing its loan book will be crucial to Starling’s profit plans.
Consumers are moderately satisfied with how their primary financial institution (FI) supports them throughout life events, according to a recent Jack Henry study. But satisfaction varies greatly by the type of event and its impact on the consumer. FI sales strategies can’t be built around products. Instead, they should facilitate financial journeys based on life events, as we explore in our June 2025 report, Future-Proofing Banking Through Customer-Centric Journeys.
Falling mortgage rates have reignited refinancing activity, particularly among borrowers with recently originated loans. Refinance volume rose 88% YoY, per Mortgage Bankers Association data from earlier this month. Traditional lenders should take a similar tack with enhancing the digital mortgage experience and focus on retaining existing mortgage customers as falling rates tempt them to refinance with competitors. The combination of personalized advice and a better digital experience could keep customers within a bank’s ecosystem.
Consumer loan volume and credit risk are getting harder to gauge as lending moves away from banks and into alternative consumer lending. One estimate says that private funding for consumer lending fintechs could support almost $140 billion in global lending over several years. FIs’ general disinterest in riskier borrowers means that they migrate to fintechs, which may retain the risk or shift it to banks and investors in ways that reveal little about borrowers on the hook for repayment. If the trend continues, widespread defaults could hit the financial system, and few will know exactly what to expect.
North Carolina-based Self-Help Credit Union is suing Fiserv for alleged lax security practices related to how Fiserv accessed its secure data. Self-Help seeks compensation for fees that it says it paid to enhance security. Financial institutions (FIs) are ultimately responsible to customers and regulators for their vendors’ actions, and it’s a huge compliance problem when one doesn’t follow through. Small FIs are known to struggle with technology talent and budgets, so they depend heavily on partners to meet their obligations. That makes FI oversight of their vendors even more essential.
PNC unveiled direct Bitcoin trading for private bank clients—high net-worth (HNW) and ultra-high net-worth (UHNW) individuals. PNC clients will be able to buy, sell, and hold Bitcoin through PNC using Coinbase’s crypto as a service product. Amid the Great Wealth Transfer, banks and brokerage firms can’t ignore crypto, and they shouldn’t satisfy themselves with retail offerings. With integrated crypto trading and custody, PNC fixes a crucial competitive gap with crypto firms and forward-thinking brokerages, augmenting wealth services to attract consumers who expect to invest in crypto. Peers will follow.
Many Gen Xers have waited until their later working years to prepare for retirement, according to a Harris Poll study, and they’re racing to catch up. After they realized retirement was nearing, 40% of Gen Xers said they cut back on discretionary spending. The story about the Great Wealth Transfer often leaves out Gen Xers. Banks should be preparing their advice offerings for the upcoming wave of Gen X retirements among and the financial strain many face as that transition nears, so these customers aren’t left behind.
BNY will integrate Google Gemini Enterprise into Eliza, its in-house AI platform. Gemini will give Eliza deep research tools and let BNY’s employees build AI agents that draw from and act on the bank’s vast libraries of financial data. The haves and have nots of banking’s AI era are coming into relief. The top strata are institutions that have invested heavily in data infrastructure that supports AI’s needs. The next strata are developing dedicated AI strategy but aren’t building as much in-house. Banks in the final strata haven’t found ways to use AI at scale but need to now.
In their earnings last week, Royal Bank of Canada (RBC) and TD Bank—Canada’s two largest financial institutions—flagged investments in AI R&D. This builds on recent data about banks’ deployment of agentic AI as well as detailed insights from JPMorgan’s and Bank of America’s public statements about their massive spending on AI and supporting infrastructure. Dollars spent on technology matter—so do how the money is spent and the number and severity of conflicting priorities. Business troubles are metastasizing more quickly because of the rapid pace of change technological innovation is imposing on a historically staid industry.
Cryptocurrency exchange Kraken announced the public launch of Kraken VIP, a service akin to a private crypto bank for investors with a $10 million average balance or $80 million in annual trading volume. Crypto is tapping the ultra-luxury market with benefits and exclusivity that have been the domain of private banks and high-end credit cards. This new frontier for crypto should incite traditional financial providers to evolve their UHNW offerings to meet rising experiential expectations.
The share of rental applicants who are more than 90 days delinquent on student loans increased from 15% in January 2025 to 32% in May, according to a just-released TransUnion report. Credit score data reflects these delinquencies, with lower-scoring consumers faring the worst. Consumers’ struggles with student loan repayments highlight a problem for financial institutions (FIs) on the hook for private-loan defaults. And as consumers delay expensive financial decisions like buying a house in favor of reducing student loan debt, demand for credit like mortgages and auto loans will suffer.
Canada’s big banks exceeded expectations for the 2025 fiscal year as capital markets and wealth management carried results. But economic uncertainty loomed over results. Adverse trade policy and a cooling labor market were hot topics, and there are risks of consumer credit stress. Threats to Canada’s economic wellbeing abound, which will trickle down to banks’ businesses. In the meantime, restructuring will likely distract management teams, slowing response to changing business conditions.