Lumin Digital gets $70 million from bank, credit union users
Lumin Digital, a digital banking tech provider to credit unions and small-to-mid-tier banks, announced on Wednesday that it has received $70 million in new investment from its own bank and credit union clients.
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This follows a recent $45 million growth equity fundraise for Lumin led by Light Street Capital, which joined Lumin as an investor during its
A recent Lumin Digital-commissioned report by 451 Research (a division of S&P Global Market Intelligence) found that for a Lumin bank or credit union client, the composite average of total financial impact — the business value of the software minus the total cost of ownership — after five years was $12.8 million, with a discounted return on investment of 145%.
“Every participant reported that Lumin Digital’s platform improved user engagement and digital adoption due to a more user-centric experience, marketing enablement and interoperability through its partner ecosystem,” the report wrote, citing a 15% reduction in churn and a 95% reduction in system downtime.
The fresh investment from bank and credit union clients reflects a broader trend in which banks are seeking to deploy AI from their existing software providers. The new funding will be used to continue supporting Lumin’s
“The majority of financial institutions make the vast majority of their revenue from loan interest,” Lumin Digital CEO Jeff Chambers told American Banker. “There’s a lack of symmetry between the quality of digital banking platforms available and the quality and innovation of loan origination systems that are available, so we see incredible value there and opportunity for us to serve our customers.”
Chambers said that AI is going to be part of what Lumin is building, but its bank and credit union clients are not asking for AI tools in a vacuum.
“They’re not looking for just AI,” he said. “They’re looking for us to solve specific problems, such as how to provide their users with high quality, well-targeted loans.”
Lumin Digital offers software that supports payments, customer relationship management, digital account opening and lending products, Chambers said, and the company is incorporating AI into all of those areas.
“I wouldn’t call AI a feature; it’s a new way of operating the company,” he said.
Founded in 2016, Lumin Digital got its start serving credit unions but is now also serving small to mid-market community and regional banks. Current community bank clients include Indiana-based First Bank of Berne and Kentucky-based Eclipse Bank. Credit union customers include
“We are investing in Lumin Digital because we’ve seen firsthand what the platform does for user growth and digital engagement,” said Dave Larson, CEO of Affinity Plus FCU. “This is a company that has earned our trust, and investing was a natural extension of a relationship already built on shared outcomes.”
Chambers told American Banker that Lumin’s ideal customer profile is financial institutions between $500 million and $20 billion in asset size, although the company is looking to expand to working with banks as large as $50 billion.
“We can’t be all things to all people at the same time,” he said. “We really looked to drive mastery with $2 to $5 billion, then $10 billion, then $20 billion credit unions. At the same time we’ve started going after the community banks that are in the $1 to $20 billion range. As that gets more traction, we’ll start to look at regional banks [and] eventually we’ll probably end up in super-regional banks.”
