ClickSWITCH CEO Cale Johnston spoke to Benzinga about his company and the role its platform for transitioning banking customers from one account to another plays in the fintech sector.
The Company
Started in 2014, ClickSWITCH was created to solve the problem of switching account holders’ direct deposits and automatic payments to new or existing accounts.
“It was new technology, and we were meeting with all of these financial institutions and they kept saying that they invest in technology, but there is a fundamental issue of getting the customer switched over,” Johnston told Benzinga.
“Last year, we saw on the market that 18 million consumers switched their banking account, and this year I would assume it will go up because of the increase of non-traditional players and digital banks that are approaching the market."
ClickSWITCH is in the right place at the right time, the CEO said.
"We really help our consumer get a deposit switched from an old institution to a new institution.”
To learn more about other companies in the space, check out the Benzinga Fintech Summit, a gathering of the top leaders in payments, lending, capital markets, blockchain and cryptocurrencies in San Francisco Nov. 14.
The Model
About 400 financial institutions are under contract with the fintech company, Johnston said.
“When you create a new product and you sell it to a financial institution, you just assume it’s going to take off. Well, that is not the case and it takes a lot of education. We came out of nowhere and spent a lot of time in the implementation phase and trained the staff on how to get the customer switched over.”
Nearly 75 percent of switches still occur within specific branches, Johnston said.
“Every time a customer positions a switch, we charge the institution. Until we deliver a profitable checking account, we don’t make any money. So we spend a lot of time and focus on how to position ClickSWITCH in the on-boarding process,” Johnston told Benzinga.
What’s Next
ClickSWITCH's focus is to make its offering as profitable and appealing as possible, the CEO said. The company has multiple avenues for growth, Johnston said.
"There could be an IPO in the future, it just depends on how we do in the next two to three years.”
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