Mascoma Bank Evolves into Tech Firm

When it comes to technology that handles customer data, most banks still rely on legacy software systems that are not cloud based and are outdated. This prompted Mascoma Bank in Lebanon to create its own in-house middleware data hub platform, Stratum, with a plan to sell its tech to other banks.

“Three companies control 85% of the market,” says Clay Adams, Mascoma’s president and CEO, of the companies that provide most banks with tech. “Banks are starting to append onto these legacy bank tech offerings, but we decided to take this a step further.”

Samantha Pause, Mascoma’s senior vice president and chief innovation and brand officer, says the bank’s data hub platform will allow for easy access to data. This can be crucial, she adds, when banks move from one technology platform to another and need to move their customers’ data incrementally.

Mascoma just launched its tech platform, allowing customers to open accounts and fund those accounts in minutes. Adams says Mascoma set up a separate subsidiary for its middleware platform and will be offering this in partnership with financial tech firms starting in 2025. “We’ve had considerable interest as a lot of banks want to move away from the legacy paradigm,” Adams says.

The move has been seven years in the making, says Pause, starting when Adams arrived. “To remain relevant, we needed to take a look at technology needed to access customer data in a holistic way,” she says. The bank’s middleware is a cloud-based software that acts as a bridge between different applications and systems to ensure they work together seamlessly. “Legacy technology can limit innovation with how customer data is handled,” Pause says.

Adams says a bank developing in-house tech is rare, and he expects Mascoma’s tech platform will be influential in the community bank space. “We’ve talked to dozens and dozens of banks as well as financial technology leaders. They all describe what we’ve done as helpful to the community bank space,” he says. “In order to be relevant and to attract new customers you have to have good in-person service and it’s also important to offer customers new services that legacy platforms don’t always offer.”

With interest rate increases and volatility over the past two years, Adams says Mascoma’s tech platform will also allow the bank to be less dependent on interest income. “We’re trying to create more roles for ourselves,” he says.

For more information, visit mascomabank.com.