Kinective: Building a Banking Operations Platform

By John San Filippo

At the recent Velera Live conference in Denver, Finopotamus had the opportunity to speak with Kinective EVP of Technology Nish Shah about the Phoenix-based fintech’s evolution and strategy. The day after this interview took place, Kinective announced the acquisition of Denver-based Datava, a market leader in data aggregation and intelligence solutions for financial institutions.

Kinective, a rapidly growing fintech company, is building a comprehensive banking operations platform designed to streamline processes and connect various systems for financial institutions. Nish Shah, EVP of Technology at Kinective, shared the company’s story, vision, and the unique approach they’re taking to help banks and credit unions thrive in a competitive landscape.

The Genesis of Kinective 

Nish Shah (r) explains Kinective strategy to Finopotamus publisher John San Filippo

Kinective’s story began with the acquisition of three distinct companies: CFM, a middleware provider for cash recyclers and other hardware; NXTsoft, specializing in core system connectivity; and IMM, a provider of e-signature and other branch-based solutions. These acquisitions, spearheaded by private equity firm OceanSound Partners, formed the foundation of Kinective. As Shah explained, “By 2022, CFM did middleware connectivity for almost every hardware you can imagine. NXTsoft provided middleware connectivity for one-to-many core systems, and IMM had been providing e-signature systems for 23 years.”

The seemingly disparate companies were strategically brought together under the Kinective umbrella in 2023, with the name symbolizing the company’s focus on connecting different business systems and hardware. Shah noted, “We created a company called Kinective [because] we’re connecting all different business systems and hardware.”

The Kinective Wheel: A Holistic Approach

Kinective’s offerings are structured around three core pillars: branch automation, digital connectivity, and document workflow. When visualized as a wheel, they represent the integrated approach Kinective takes to address the operational needs of financial institutions. Branch automation incorporates legacy CFM and IMM solutions, while digital connectivity leverages NXTsoft’s expertise. Document workflow streamlines document signing and related processes. “So how do we get branches and digital working together?” Shah emphasized, “Operationally we come into the picture as a cohesive banking operations platform.”

A fourth crucial element is the decisions engine, which analyzes data from branch automation systems, offering insights into cash flow and optimization. This data empowers institutions to make informed decisions about cash management and resource allocation. “We actually give customers at a branch level, at a teller level, reporting that says how much money is really sitting there,” Shah said.

One Kinective: Integrating for Enhanced Customer Experience

The merger of the three companies hasn’t been without its challenges, Shah noted, but Kinective prioritized creating a unified customer experience. They’ve achieved this by cross-training support staff, while maintaining specialized expertise for escalated issues. This blended approach ensures customers receive comprehensive support regardless of the specific product they’re using. As Shah explained, “We have level one and two support trained on the CFM side or IMM side or NXTsoft. Then we have subject matter experts at an escalation level.” This allows Kinective to efficiently serve its extensive customer base of over 3,400 financial institutions, split evenly between banks and credit unions.

Partnering for Success: Fintechs and Cores

Kinective plays a crucial role in connecting fintechs to core systems, simplifying integration and accelerating growth for emerging companies. Instead of requiring fintechs to build individual integrations for each core system, Kinective provides a centralized platform. This allows fintechs to focus on their core competencies and reach a wider audience. Shah noted, “They’re starting to not just build anything. They’re actually now seeing the problem that they want to solve.” This focus on problem-solving benefits both fintechs and the financial institutions they serve.

The Future of Kinective: Expansion and AI

Looking ahead, Kinective is poised for further expansion. A recent investment from TA Associates, alongside OceanSound Partners, reinforced their commitment to growth and innovation. Shah hinted at an upcoming announcement (not yet able to discuss the Datava acquisition noted above) that will further enhance the Kinective platform, stating, “It’s coming very soon...It will complete the wheel a hundred percent.”

He also predicted that artificial intelligence (AI) will play an increasingly important role in simplifying operations and providing predictive insights for financial institutions, ultimately benefiting their customers and members. “I see that happening very soon,” Shah stated. He added that Kinective is committed to empowering financial institutions with the tools and connections they need to thrive in a dynamic and evolving financial landscape.