Financial Institutions

Unlock HSA deposits with employer benefits

The Opportunity

Health savings accounts offer banks the ability to take custody of enduring, low-cost deposits.

The Problem

Financial institutions are missing out on HSA deposits because they can't offer employers a complete, embedded consumer-directed benefits solution.

The Solution

Banks leverage First Dollar's platform to quickly offer compliant embedded HSAs, FSAs, and HRAs within their member portals.

Why should financial institutions offer health spending benefits?

Capital has gotten expensive

A higher federal funds rate makes it more expensive for banks to lend money, which has downstream impacts on their revenue. Fewer consumers and businesses will take out loans (e.g., the recent housing market), and fewer mergers and acquisitions will occur.

A line graph that shows the federal funds rate since 2003 compared with some HSA asset size points in time. It highlights where the HSA market opened in 2003, as well as two high points in the funds rate in 2007 and 2023. In 2007 the HSA total asset size was $3.4 billion. In 2023 the HSA total asset size was $137 billion.

Macrotrends

Deposit rates haven't kept pace

With a higher federal funds rate, banks enjoy a higher yield from their deposits. However, deposit growth has slowed, even with recent increases. With a higher federal funds rate and a lower deposit growth rate, banks are looking for new deposit sources.

A line graph showing total bank deposit growth percentage year over year from 2004 to 2024. The highlight is a large spike between 2021 and 2022, with a sharp drop after 2022 and a small rebound starting in 2023.

Federal Reserve Bank of St. Louis (FRED)

HSA deposits continue to grow

A mature HSA market has never experienced a high federal funds rate. Introduced in 2003 by the Medicare Modernization Act, HSAs have grown steadily year over year. With qualified expenses for withdrawals, HSAs offer today's banks the promise of low-cost, sticky deposits.

A bar chart showing total HSA assets, both investments and deposits, in billions of dollars from 2007 to 2024. It shows a steady upward slope year after year in asset value topping at $142.4 billion in 2024.

2024 Midyear Devenir HSA Research Report

What's blocking banks from offering HSAs to employers?

A snippet of UI showing stacked health savings, dependent care, and remote work benefits with their account balances.

Incomplete solutions

Employers are seeking one vendor for their FSAs, HRAs, HSAs, and LSAs. If a bank cannot meet all of an employer's health spending benefit needs, the bank cannot win the deal.

Legacy tech

Banks already have consumer-first platforms. Banks need flexible tech infrastructure that can work behind the scenes so employers and employees can access their benefits from within their member portals.

HSA Regulations

Many HSA rules and regulations differ from more standard banking regulations. So even if a bank has NBT authority via its banking charter, the bank likely still needs to complete operational and compliance work to comply with HSA laws.

Compliance assistance

It's counterintuitive, but banks need compliance help with employer-sponsored benefits. Offering benefits to employees through employers is very different than offering benefits directly to consumers. Banks need tech providers who meet their high compliance standards.

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NONBANK TRUSTEE

Enjoy a partner with NBT designation

First Dollar's NBT status simplifies the hurdles of HSA compliance. By partnering with First Dollar, banks can offer faster, compliant HSAs to employers.

An illustration showing multiple benefits on one benefit card.

COMPLETE SOLUTION

Win employer benefits with a complete solution

We offer the full health wallet, which means banks compete and win employer benefit deals for FSAs, HRAs, HSAs, LSAs, and more.

APIs

Embed your benefit offering

Every Health Wallet and Health Wallet Manager event has an API, from the consumer experience to the administrative workflows and core bank functions.

A section of the API code for displaying a health wallet with multiple benefits.

An illustration of our reimbursement widget, which can sit on top of your existing platform.

BRANDING TOOLS

Use your brand, ours,
or something in-between

From completely re-branding our Health Wallet with your brand (and your sending domain for communications) to co-branding to nested branding for your clients, we support a variety of brand configurations.