Fifth Third has made another move to boost its payments business.
The Cincinnati-based bank said Wednesday that it recently bought a cash management software service called DTS Connex, which expands Fifth Third's commercial payments capabilities in cash logistics, infrastructure and risk management.
Bridgit Chayt, Fifth Third's head of commercial payments, said in a prepared statement that the bank has worked to build a business that goes beyond traditional cash processing services. She called the acquisition of DTS Connex "a pivotal milestone" for the $210 billion-asset bank, bringing expertise, technology and scale to Fifth Third's payments operation.
"This acquisition expands our ability to automate cash operations and fosters deeper collaboration across the cash ecosystem through advanced data sharing," Chayt said.
DTX Connex, which will continue to operate on a standalone basis, focuses on serving businesses with multiple locations, like retailers, restaurants and health care providers. The service, a registered trademark of International Financial Services, became a subsidiary of Fifth Third on Aug. 1. Financial terms of the deal weren't disclosed.
The bank previously collaborated with DTS Connex on the development of DTS Connex's deposit tracking solution, said Robert Norman, director of cash logistics strategy at Fifth Third, in a prepared statement.
"This acquisition will allow for continued strategic partnerships and forward-thinking cash logistics software solutions that will accelerate growth across the sector," Norman said.
The addition of DTS Connex marks the bank's latest purchase to bulk up its payments services. In 2023, Fifth Third bought Big Data Healthcare and Rize Money. The bank then launched Newline, an application programming interface platform for businesses to offer payment, card and deposit products, which counts Stripe, Trustly and Rippling among its clients.
Chayt told American Banker earlier this summer that the company has been staying on trend by growing its embedded payments offerings, along with services to manage payables and receivables for clients.
She said that by "helping clients actually embed our transaction engines into their own products," Fifth Third is "stimulating commerce rather than only moving money."
Earlier this year, Newline launched a new virtual reference number product, designed to enable easier reconciliation mapping and prevent fraud by allowing clients to create unlimited account numbers. The VRNs, like tokenized account numbers, can be developed for vendors, invoices and ledgers, and they facilitate real-time, account-to-account payments.
Fifth Third CEO Tim Spence said last month that the bank continues "to see transaction migration from legacy ACH to modern instant payments rails."
In the second quarter, Newline reported 30% revenue growth from the previous year, and Fifth Third showed a $1 billion rise in commercial deposits connected to the platform. But the bank's commercial payment revenue has decreased slightly in the past year, due to lower spending on commercial cards.
Fifth Third, which said it processed $17 trillion in payments volume last year, has been vocal about its ambitions in the payments space as certain technologies, like stablecoins, are blessed by regulators.
Spence said last month that the bank sees opportunities for developments like providing payment rails to cryptocurrency infrastructure companies or using stablecoins for cross-border payments, among other uses.
Spence also said during the company's second-quarter earnings call that the recently-passed GENIUS Act could represent a "greenfield" for the bank.
