Digital bank Onyx Private is reportedly changing its business model and “moving away from the B2C model.”
The company is not shutting down, Onyx Private CEO Victor Santos told TechCrunch in a report posted Monday (March 18).
Santos said this when asked by TechCrunch about an email Onyx Private sent to a customer, saying that the company was discontinuing its services and beginning to close all associated accounts starting on March 13, the date of the email, and would finalize the shutdown on April 14, per the report.
He added that Onyx Private’s new business model will include a business-to-business (B2B) platform-as-a-service for financial institutions (FIs) that want to launch digital apps for young, affluent consumers, according to the report.
Santos also dismissed a report that Onyx Private faced regulatory challenges, saying no such issues played a role in the company’s decision to close its business-to-consumer (B2C) offerings, per the report.
“It was purely a strategic decision that allowed us to leverage the base of existing FIs and use the technology we have built to scale in a more capital-efficient manner,” Santos said in the report.
This report comes about 10 months after Onyx Private raised $4.1 million in a funding round, saying it aimed to provide private banking and investment services tailored to affluent millennials and Gen Zers, according to a May 22, 2023, report by TechCrunch.
At the time, Onyx Private offered banking services in partnership with Piermont Bank; investment services in collaboration with Helium Advisors and the Bank of New York Mellon’s Pershing; and a “lifestyle concierge” service delivered via a digital personal assistant.
The company aimed to serve lawyers, doctors, tech workers and other affluent professionals, proving a private bank that would “democratize the tools that today are only available to the ‘ultra rich,’” Santos said at the time.
In another recent development in the digital banking space, British banking-as-a-service (BaaS) platform Griffin said March 10 that it had received approval from the U.K.’s financial services regulators to launch as a fully operational bank.
In January, i2c and The Bank of Missouri (TBOM) partnered to help FinTechs create digital banking products. Together, the companies will help FinTechs offer checking and savings accounts, consumer and small business loans, credit cards, rewards programs and virtual cards.
