Another week, another deal for blockchain startup Figure Technologies. New York Community Bank (NYCB) is investing in Figure as part of a strategic partnership that will see it use Figure’s Provenance blockchain. Both firms will invest in the JAM FINTOP Blockchain Fund, backed by many U.S. community banks. Figure’s CEO Mike Cagney will lead the JAM FINTOP Blockchain fund advisory committee.
NYCB already has a node on the Provenance blockchain and says it wants to use blockchain to:
- reduce the cost and complexity within the mortgage business
- support financial inclusion in banking and credit
- embrace a faster and less expensive payments system.
“We chose Figure because of its focus on and knowledge of banking and payment systems,” said NYCB Chairman, President, and CEO Thomas R. Cangemi. “Our agreement with Figure is a part of NYCB’s strategic focus on the operational and cost benefits that blockchain technology can bring to bear across many areas of banking.”
Figure has numerous blockchain solutions, but at least two of them seem to match NYCB’s requirements. One is Figure’s mortgage blockchain and the other is Figure Pay, a nascent payment solution that aims to offer the underbanked credit at the point of payment.
NYCB could provide significant deal flow for the mortgage blockchain. In April, the community bank agreed to acquire Flagstar Bancorp, a major originator and servicer of mortgages and loans. Flagstar deals with payments and record-keeping for $247 billion of loans for 1.1 million clients.
Meanwhile, earlier this month, Figure agreed to merge with mortgage company Homebridge Financial Services which originated $25 billion in mortgages last year. This follows the $200 million Series D funding round that Figure raised in May at a $3.2 billion valuation. It also has a strategic
The JAM FINTOP Blockchain Fund seems like a substantial opportunity for Figure. The JAM FINTOP Bank Network has 66 community bank members. It boasts that combined, the assets would make it the United States’ fifth largest bank. The network aims to help community banks “proactively identify, invest in and implement the right technology to remain relevant and competitive.” The Blockchain Fund is new, and banks can opt in. Cagney now heads the Blockchain advisory committee, and Figure COO June Ou is the Technical Advisor.
On the topic of funds, in July Figure inked a deal with Apollo Global, which plans to use the Provenance blockchain to list funds.