New offering to improve financial institutions' ability to acquire new customers online, increase deposit market share
Partnership supports Digital Insight's stated strategy of leveraging its unique distribution channel to create competitive advantage for middle market financial institutions
New York, NY - June 20, 2005 —Digital Insight Corp. (NASDAQ: DGIN) (www.digitalinsight.com), the leading online banking provider, announced today it has entered into a strategic alliance with CashEdge Inc. (www.cashedge.com), the leading provider of online financial applications, to become the exclusive distributor to small and mid-sized financial institutions for CashEdge's instant account opening and funding solution. The new addition to Digital Insight's robust consumer Internet Banking product portfolio, "New Account Open & Fund", enables consumers to apply for, gain approval of, and fund a new account in minutes via a financial institution's Web site. The exclusive partnership extends for a five-year term through 2010.
Digital Insight will offer New Account Open & Fund to small and mid-sized financial institutions at preferred partner pricing by leveraging the Company's extensive distribution and purchasing power. Under the terms of the partnership agreement, Digital Insight has pre-purchased a multi-year supply of New Account Open & Fund transactions from CashEdge for approximately $6.25 million. In connection with the terms of the agreement, CashEdge will also issue a warrant to Digital Insight to purchase shares of CashEdge stock on terms to be determined.
Online account opening and funding is an important feature for online banking application vendors to provide their client banks, according to George Tubin, senior analyst in the Delivery Channels practice at TowerGroup.
"Online banking usage can lead to deeper customer relationships and higher customer profitability. The ability to open and fund accounts online not only removes a significant barrier to use of the online channel, it provides a myriad of competitive advantages to financial institutions that offer the capability," said Tubin, who also notes that approximately 80 percent of the nation's Top 10 banks currently offer the service but small and mid-size institutions have yet to do so.
New Account Open & Fund improves financial institutions' ability to acquire new customers online and increase deposit market share, while potentially increasing close rates on new account applications and decreasing new deposit acquisition costs. The solution automates the process of verifying a new account applicant's identity, credit and OFAC information based on an institution's unique business rules to deliver an approval or denial in real-time. Once approved, the consumer can fund a new account via ACH transfers of funds from existing deposit accounts.
"CashEdge is excited to partner with Digital Insight for opening and funding new accounts because this partnership provides us more rapid and cost-effective distribution access to an important market segment," said CashEdge CEO Sanjeev Dheer. "We have been very successful in penetrating the large bank market, and Digital Insight has built the most important distribution channel serving small to mid-sized banks and credit unions."
"This partnership is extremely important to Digital Insight and a key step in implementing our strategy of using relationships to provide a growing array of mission-critical capabilities to our clients, without the risk and disruption that inevitably results from integrating and managing acquisitions," said Digital Insight Chairman, President and CEO Jeff Stiefler. "Since we are Cash Edge's exclusive distribution channel into the small and mid-sized market, our clients can benefit from a competitive advantage in the war to grow deposits and gain market share. This agreement has been structured to include all the elements of an ideal partnership: market-leading pricing on new product developments that benefit our clients, exclusive distribution rights to our target market, plus, as an added benefit to our investors, the ability to participate financially, through warrants, in the valuation increase we expect to help Cash Edge achieve."
CashEdge® provides innovative, online financial applications to banks, credit unions and wealth management firms. CashEdge's solutions include end-to-end online account opening and funding, funds transfer, small business payments and invoicing, and data consolidation. These proven solutions are flexible, scalable and supported by extensive risk management capabilities.
CashEdge has been ranked by Inc. Magazine as one of the 500 fastest growing private companies in the United States for two years in a row. In 2007 it was also recognized by the 2007 Deloitte Technology Fast 500 and Fast 50 as one of the nation's 500 fastest growing private companies and one of the 50 fastest growing companies in the New York area, respectively. The company currently serves hundreds of leading financial institutions including four of the top five banks, 23 of the top 100 banks, and 20 of the top 100 credit unions. CashEdge has offices in New York, Silicon Valley and India. For more information, please visit www.cashedge.com.
Contact:
Jennifer Moritz
Zer0 to 5ive
917-748-4006
jmoritz@0to5.com
Digital Insight® Corporation is the leading online banking provider for financial institutions. Through its comprehensive portfolio of Internet-based financial products and services built upon the company's unique architecture, Digital Insight enables banks and credit unions to become the trusted transaction hub for their retail and commercial customers. Digital Insight offers consumer and business Internet banking, online lending, electronic bill payment and presentment, check imaging, account-to-account transfers, Web site development and hosting and marketing programs designed to help increase online banking end user growth and more. Each Digital Insight product and service reinforces the strength of its financial institution clients.
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the continued success and future growth potential of the relationship between Digital Insight and CashEdge and the ability to attract new end users. Such statements are based on management's current expectations. Because of various risks and uncertainties, including unrealized expectations for continued success and growth of the relationship between Digital Insight and the CashEdge, and slower than anticipated product implementation schedules and end user adoption, actual strategies and results in future periods may differ materially from those currently expected. Additional discussion of factors affecting these forward looking statements is contained under the caption "Risk Factors" in Digital Insight's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission. Digital Insight undertakes no obligation to update publicly any forward-looking statements.
Ann S. Cave
678-375-4039
ann.cave@fiserv.com