I had a good chat with CashEdge <cashedge.com> VP Neil Platt at BAI's Retail Delivery last week. The company is busy working on a much-needed channel integration initiative so that account applications begun online can be completed with a phone call or even a branch visit, with no need to start all over from scratch.

The company hopes it can capture half of what it estimates is 70% of completed online applications that go unfunded
(see chart inset).
If that's true, the payback for the solution, at least at larger financial institutions, will likely be measured in months, if not weeks.

Other projects in the works:

• Cross-selling other bank products during the new account-opening process
• Facilitating other types of applications, such as loans
• Improving risk management by tapping additional data sources outside the credit bureau

CashEdge is a great example of a specialist that carves out a profitable niche in a relatively narrow, but risky area of online operations, new account funding. Thanks to big clients such as Citibank, the company is on track to facilitate one million online account openings this year, about a quarter of the estimated 3.5 to 4 million new checking and savings accounts opened this year online (Note: CashEdge estimates). 

The company ranked number 101 in INC Magazine's list of the 500 fastest growing private companies. According to the published figures, the 177-person company grew from just over $1 million in revenues in 2002, to approximately $10 million in 2005.