Onyx Private, a digital bank based in Miami that provides investment and banking services to customers has announced its plan to terminate all its bank operations.
On March 13, the firm distributed emails to its customers revealing its aim to stop all operations. It also informed customers that it would close all accounts related to the company, beginning from the day of the announcement.
The co-founder and chief executive officer of Onyx Private, Victor Santos, confirmed that the firm was changing from the B2C model. However, he revealed that the company only plans to change its business model and not completely shut down.
Onyx Private Plans To Migrate To A B2B Paas Branded Solution
Santos mentioned that Onyx Private will move to a B2B branded platform-as-a-service solution for credit unions, regional banks, and community banks. This shift is specifically for those financial institutions that plan to launch digital apps developed for young affluent consumers.
Furthermore, He claims that the firm has been exploring the B2B concept for the past 12 months. The company has succeeded with its previous development schemes with some partners, Santos revealed.
In May 2023, the startup declared that its venture funding raised about $4.1 million from major investors like Olive Tree Capital, and 186 Ventures. Others include One Way Ventures, Global Founders Capital, Y Combinator, and Village Global.
During the funding period, the firm stated that Onyx Private had increased its month-over-month value by 30%. The company, which claims to be the next-generation UBS, saw more than $4 million in Monthly transaction payment volume. It also declared that the total payment volume has nearly reached $5 million.
Santos Dismisses Regulatory Issue Claims Pointed At Onyx Decision
Santos has recently refused to reveal the total banking customers in Onyx. However, a source disclosed that regulatory issues may be one of the reasons for this latest move. The claim was dismissed as Santos said that the decision wasn’t pushed by any regulatory issues.
He added that the decision was simply a strategic one aimed at allowing the firm to leverage the foundation of existing financial institutions. Also, it was made to utilize the technology that was developed to grow significantly in a more capital-resourceful manner.
When the company was in its fundraising period, it announced that Piermont Bank was its banking partner. Recently, Onyx stated on its website that banking operations are now provided by i3 Bank. Santos later mentioned that Piermont was the bank’s initial partner, but later changed to i3 Bank last year.