First Internet Bank

Founded by technology entrepreneur David Becker, First Internet Bank (the “Bank”) opened in February 1999 as the first wholly online-based bank in the United States. It was also the first state-chartered, FDIC-insured Internet bank.

When First Internet Bank was conceived, online banking was still a novel concept for many consumers. While some traditional banks offered this service, public adoption was small. Using an Internet-only bank, meanwhile, was even less common. These factors contributed to First Internet Bank’s lengthy regulatory process, which took 3 ½ years to complete.

After receiving FDIC approval, First Internet Bank commenced banking operations at its headquarters in Fishers. Despite having a physical corporate office, all services and transactions occurred virtually online. One advantage of this system was 24/7 customer access to the Bank, including interactive chats with company representatives.

Another benefit of the virtual bank was greatly reduced overhead. Most of the money First Internet Bank saved by not having brick-and-mortar branches was passed to customers via higher deposit rates and lower service fees.

First Internet Bank grew organically over the years by adding new customers, products, and capabilities. In 2007, First Internet Bancorp, the bank holding company that owns First Internet Bank, acquired Indianapolis-based Landmark Financial Corporation. This acquisition merged Landmark Savings Bank (FSB) into the Bank. As a result of this consolidation, First Internet Bank added a retail mortgage lending operation to its online platform.

First Internet Bancorp had its initial public offering (IPO) in 2013. The following year, First Internet Bank reached $1 billion in assets. By 2020, First Internet Bank provided consumer and small business deposits, consumer loans, residential mortgages, and specialty finance services nationally. It also offered commercial real estate loans, commercial and industrial loans, SBA financing, and treasury management services. The Bank’s assets were approximately $4.3 billion.

In fall 2020, First Internet Bank’s new corporate headquarters opened. Designed by Browning Day, it is a six-story building located in the Fishers historic Nickel Plate district and is near the Nickel Plate Trail.

The bank became one of relatively few U.S. banks seeking to do business with financial technology companies, fintechs, using the banking-as-a-service,” or BaaS model in early 2022. Its first Baas deposit generated $50 million in deposits. The amount represents just 2 percent of the bank’s deposits but signals its pivot toward BaaS business. To assist in finding suitable fintech partners, First Internet Bank acquired San Francisco-based Synctera, a “matchmaker” startup specializing in pairing banks with fintechs.