A patented product, process, and series of modules enabling banks and brokerages to offer advancement and delivery of dividend income to shareholders on their desired schedule.
The platform
DividendAdvance is a patented product, process, and series of modules that enable a bank and brokerage to offer the advancement and delivery of dividend income to shareholders or unit holders on a desired schedule for a fee, versus the quarterly or monthly distribution schedule defined by their holdings.
DividendAdvance offers pre-built UX/UI modules designed to integrate with existing banking and brokerage back office financial management, clearing, lending APIs, and data feeds. The platform runs as a white label product promoted internally and externally with complete bank/brokerage autonomy.
Reinvestment module
DRIP Accelerator is the process and calculation module associated with the potential benefit of reinvesting advanced dividend income in comparison with reinvestment of dividend income received on a traditional basis.
The projection module allows an account holder to view a stock or group of stocks’ historical data to calculate and display the potential benefit of reinvesting advanced dividend income in comparison with reinvestment of dividend income received on a traditional basis over a period of time to see the net benefit of advanced dividend reinvestment over traditional reinvestment.
Who benefits
75% of investors prefer monthly dividends, yet only 1.4% of companies pay monthly.
Consumer data is unanimous in proving investors anchor emotionally to regular cash flow. This behaviour prompts banks and brokerages to clearly label projected monthly income for a client portfolio.
The institutionalized monthly income investment product industry has catered to this behaviour and holds hundreds of billions of dollars of consumers’ capital. With DividendAdvance, stockholders can unlock that convenience with traditional stock ownership through their existing brokerage and receive their dividend income on the first of every month regardless of when the dividend is paid.
Who benefits
The benefits to the first mover Bank (Broker-Dealer) are considerable and can be best described in the DividendAdvance simulator and digital ledger. DividendAdvance offers a new revenue stream within an existing age-old dividend distribution process.
This is accomplished by offering added value and benefit to the consumer in exchange for a fee. In addition to the short lending cycle repaid by the client’s dividend income, the fee remains low, while the return and net benefit to the Bank is high.
Frequent repayment (traditional quarterly payments for example) can even temporarily exceed the advance balance resulting in predictable monthly income for the client and a low average loan balance for the bank. The amount advanced represents a small fraction of the account holders’ equity and is secured through their holdings.