Receipt management on steroids
Sensibill’s demo of its “+Insights” product (launching January 2018) initially struck me as a pedestrian receipt capture app. But the Toronto-based startup’s pitch gradually revealed layers of intrigue.
As opposed to straightforward item scanning, its technology allows users to hover over a paper statement to capture and categorize spending.
Sensibill touts the added user engagement (from both consumers and small businesses) that results from baking this capability into a mobile banking app. Moreover, it promises to make the “Holy Grail” of SKU-level info available to financial institutions, augmenting the transaction data already at their disposal (e.g., credit unions may know their member spent $76 at CVS, but not what they bought).
My kneejerk objection was, “yeah, good luck getting consumers to upload all their invoices.”
But in a subsequent conversation Sensibill Chief Technology Officer Jamie Alexander countered, “You can glean a lot of insights from a small amount of data.”
Companies like Tallie are already in market partnering with credit unions on receipt management solutions, but Sensibill is pursuing an intriguing extension of this model.
A bit further afield, Unison aims to solve the problem of first-time home buyers lacking sufficient down payments, particularly in high-priced markets. The San Francisco firm points out that by increasing the down payment to more than 20% of purchase price, buyers can reduce the monthly repayment amount by eliminating the need for mortgage insurance.
Further, Unison’s role does not add to the monthly payment, allowing buyers to afford more house. This is because Unison takes its cut on the back end, as a percentage of the value appreciation at sale.
There are several ingenious aspects to this model. Unison claims its funding equation works because it raises capital from institutions willing to wait for long-term appreciation without a need for near-term liquidity.
Unison largely avoids its own credit underwriting process, because customers have already been vetted by a traditional mortgage provider.
A host of compliance concerns enter my mind, however, including a potential morass of paperwork to protect all parties. Unison is active in 13 states (including regulation-heavy California), with another batch on the horizon.
Perhaps coincidentally, The New York Times recently featured a startup called Loftium tackling the same down payment issue by requiring home buyers to repay the increment via Airbnb proceeds.
Notwithstanding the temptation to poke holes in business models, these ideas blew my mind—which is one of the main benefits of Finovate.
GLEN SARVADY is managing partner at 154 Advisors and senior payments expert with Best Innovation Group, a CUNA consulting partner. Follow him on Twitter via @154Advisors. His views do not necessarily reflect those of Credit Union National Association.