Bank customers can now become part owners of Lenders Cooperative

A consulting practice for community banks and a group of its bank clients have launched Lenders Cooperative, a stand-alone, client-owned entity providing software and shared services for credit underwriting, small-business loan servicing, bank operations and white labeled call center support. Financial services customers can now gain equity ownership when they become clients.

Lenders Cooperative was established in 2019 as a subsidiary of Summit Technology Group, a consulting, services and software practice for community banks. On Tuesday the firm announced that it would spin off Lenders Cooperative as an independent unit. The Cooperative is finalizing investment and all relevant regulatory approvals. Lenders Cooperative serves 140 financial institutions as customers, but it declined to name or say how many banks were co-owners, aside from the $4.9 billion-asset Cape Cod 5 in Hyannis, Massachusetts.

Lenders Cooperative is one of several examples of community banks or credit unions collaborating on technology from which both they and their peers can benefit. 

"As an initial customer of Lenders Cooperative, and a past investor of STG, we have seen firsthand the many benefits of its innovative solutions and services, as well as a strong return on our capital," said Matt Burke, CEO of Cape Cod 5, in a press release. Cape Cod 5 partnered in the development and launch of the Lenders Cooperative platform.

The cooperative of community and regional financial institutions offers a cloud-based online loan origination system for small-business commercial and industrial, Small Business Administration and other commercial loans. The shared services team fills in staffing gaps at financial institutions by helping out with credit underwriting, SBA loan servicing and loan and deposit operations. It offers a white-label contact center for small business borrowers who need assistance obtaining a loan.

"Lenders Cooperative's unique model not only allows our customers to own the technology they use, but also provides the chance to be a part of a growing community of bankers that are actively exchanging shared knowledge," Loughlin Cleary, president and national sales director of Lenders Cooperative, said in the release.