Swaystack partners InstaSwitch to boost business banking

Swaystack has partnered with InstaSwitch, adding account activation tools to Swaystack's offering for banks and credit unions.

The tie-up targets business banking customers who open new accounts but have not yet moved their day-to-day financial activity from an existing provider. The integrated service allows banks and credit unions to help customers transfer deposits, payroll, and spending into newly opened business accounts without sending them into a separate workflow.

This is a common problem in small business banking. Many owners open an account with a new institution but stop short of making it their main operating account because moving income streams, supplier payments, payroll arrangements, and customer billing links can be cumbersome.

Swaystack focuses on onboarding and engagement for financial institutions, using digital journeys across banking apps, email, and text messages to prompt account holders to complete actions such as funding an account or changing direct deposit arrangements. InstaSwitch provides the switching infrastructure designed to move operational banking activity from an incumbent provider to a new one.

More than 5 million small businesses in the US attempt to switch bank providers each year, according to the companies, yet many do not complete the process. That matters for banks and credit unions because a newly opened account does not necessarily become a profitable or durable customer relationship unless regular income and spending activity also move over.

Primary relationship

In business banking, lenders and deposit-taking institutions compete not only to win a new account opening but also to secure what the sector calls the primary relationship. That generally means becoming the main account used for payroll, supplier payments, customer receipts, and routine operating spend.

Without that shift, a business may leave a new account lightly used while continuing to rely on its previous bank for core transactions. For institutions trying to increase deposits and deepen customer ties, that can limit the value of customer acquisition efforts.

Daniel West described the partnership as an extension of Swaystack's existing role in customer engagement.

"We partnered with Swaystack because of what they've built. Banks and credit unions trust their product to engage their account holders and win primacy. Adding InstaSwitch means these institutions can do even more for their business customers, moving operational activity into newly opened accounts at scale," said Daniel West, Founder & CEO, InstaSwitch.

The integration is designed to take users from account opening to activation in a single process. Rather than requiring a business customer to leave the onboarding environment and use another tool, the combined service keeps the switching process within the same journey.

Har Rai Khalsa said the challenge in business banking is not simply persuading a customer to open an account, but getting them to redirect the financial flows that make the account central to operations.

"Our framework has always been that the primary relationship is earned, not assumed. The bar is high in business banking. The institution has to earn income, payroll, and spend all moving into the new account before the customer defaults back to where their spend and operational activity already lives. InstaSwitch is the execution layer that makes that possible at scale," said Har Rai Khalsa, CEO & Co-Founder, Swaystack.

Market context

The partnership reflects a broader push in financial technology to reduce the friction that follows digital account opening. Consumer banking providers have long tried to simplify switching, but business banking has remained more complex because companies typically rely on several separate systems for payroll, invoicing, supplier payments, and expense management.

That complexity can create a gap between customer acquisition and customer activation. A bank may succeed in opening an account through a digital process, yet still fail to capture meaningful balances or transaction volumes if the business never completes the move.

Har Rai Khalsa and Simran Singh founded Swaystack. Banks and credit unions use its platform to guide new account holders through onboarding tasks and product adoption.

InstaSwitch is used by fintechs and financial institutions including Arc, Relay, and Lettuce, according to the company. It has raised USD $5.1 million in seed funding led by Chicago Ventures and has completed diligence with a financial institution holding USD $40 billion in assets.

The companies are positioning the combined service around the first weeks after account opening, when a new provider has the best chance of becoming a business customer's main bank before activity stays with the incumbent by default.