U.S. Bancorp acquiring fintech partner TravelBank

For the past year, U.S. Bancorp has been partnering with the fintech company TravelBank to offer corporations a streamlined way to generate and manage employee expense reports.

Now, U.S. Bank’s parent is bringing that technology in-house.

The Minneapolis-based company is acquiring TravelBank in a deal expected to close by the end of the year, U.S. Bancorp said Tuesday. Financial terms were not disclosed.

Bloomberg

The move will “significantly expand” U.S. Bancorp’s client list and provide more value to customers, Shailesh Kotwal, the company’s vice chair of payment services, said in a press release. Unlike paper-based expense reporting systems, the TravelBank platform provides an all-in-one solution that ties into accounting systems and automates the process from start to finish.

“We are focused on giving businesses more confidence, control and convenience in managing payments and expenses,” Kotwal said. “TravelBank will help us accelerate these efforts.”

Duke Chung, founder and CEO of San Francisco-based TravelBank, will join U.S. Bancorp after the acquisition is finalized and will continue to manage TravelBank, a U.S. Bancorp spokesman said.

Chung will report to Jeff Jones, U.S. Bancorp’s head of corporate payment and treasury solutions.

The acquisition builds on work that U.S. Bancorp began in 2019 when the $567 billion-asset company launched an app with Chrome River called Expense Wizard that set out to simplify the process of filling out expense reports and getting reimbursed for business trips.

A year later, the bank rolled out Instant Card, a virtual corporate card for clients with remote employees. The card, which can be linked to a mobile wallet, allows remote staffers and contractors to make authorized purchases without needing to use their personal credit cards.

In September 2020, U.S. Bancorp and TravelBank teamed up to integrate Instant Card into the TravelBank app. At the time, Chung touted the app as a way to facilitate contactless payments during the pandemic.

The acquisition announced Tuesday is the latest in a long string of deals in which banks buy nonbanks — often in an effort to generate more fee-based income in a low interest rate environment.

As of September, JPMorgan Chase, the largest U.S. bank by assets, had completed more than 30 acquisitions since December 2020. The businesses that JPMorgan have scooped up include a credit card rewards business, a London-based digital wealth manager and the company that owns Zagat, the publisher of annual restaurant reviews.

U.S. Bancorp has announced its own share of acquisitions this year — involving both banks and nonbanks. In August, the company completed the purchase of Bento Technologies, a business that offers payment support and expense management services.

The following month, U.S. Bancorp said it would buy MUFG Union Bank in San Francisco for $8 billion. The proposed acquisition, which would create a super-regional bank with $664 billion of assets, is currently facing pressure from community groups that are calling for public hearings.