MVB Bank adopts Kobalt AI for fintech risk oversight

MVB Bank has adopted Kobalt Labs' artificial intelligence platform for fintech partner risk oversight and marketing compliance, focusing on automating compliance work tied to partner reviews and monitoring.

The system will be used for due diligence, ongoing monitoring, fintech partner collaboration and marketing compliance checks, replacing several manual processes. Kobalt's software is designed for financial institutions that need to assess vendors and fintech partners against changing regulatory expectations.

MVB has a substantial fintech business alongside its retail and commercial banking operations. It works with fintech companies in payments, card issuance, sponsorship lending and online gaming programmes, areas that typically face heightened scrutiny around third-party relationships and oversight.

The agreement reflects a broader push by banks to tighten third-party risk management as regulators increase their focus on how institutions supervise outside partners. In practice, that involves collecting evidence, reviewing policies and procedures, identifying control gaps and documenting risk decisions consistently.

Kobalt says its platform analyses policies and procedures, supports security and marketing compliance assessments and helps banks produce risk assessments more quickly. Its customers include Chime, Upstart, Zions Bancorp, Emprise Bank, Core Bank and Meriwest Credit Union.

A key part of the arrangement is marketing compliance, which has grown in importance as banks work with fintech brands that market financial products directly to consumers. Oversight in that area can include reviewing advertising language, disclosures and partner practices to ensure they align with banking rules and supervisory expectations.

Chief Executive Officer and Co-Founder Kalyani Ramadurgam said the deal responds to the need for more repeatable oversight. "If you want to show your regulators you're doing it right, you have to add consistency and scale with technology," Ramadurgam said.

"We're excited to partner with MVB and help them expand and automate their risk oversight," she added.

MVB said the arrangement fits its broader approach to technology and regulated fintech partnerships. The bank has built a business around providing infrastructure and banking services to fintech companies while maintaining its core banking presence in established markets.

That model has become more significant across the US banking sector, where sponsor banks and banking-as-a-service providers face pressure to demonstrate close supervision of programme partners. Institutions in that segment often must show that compliance reviews are not only thorough but also documented in a way that stands up to examination.

Larry F. Mazza, Chief Executive Officer and President of MVB Financial, said the bank sees Kobalt as part of that effort.

"MVB is committed to being at the forefront of technological innovation, and we're always looking for fintech innovators like Kobalt who are shaping the future of the industry," Mazza said.

"We share a strong commitment to effective risk oversight and management while meeting regulatory requirements, and we're confident this partnership will help us do that at scale," he added.

Klaros Group, an advisory firm that works with both companies, introduced Kobalt and MVB. Its involvement highlights the growing role of specialist advisers in helping banks select tools and operating models that meet supervisory demands around third-party oversight.

Adam Shapiro described that pressure directly. "Klaros is focused on helping financial institutions modernize risk and compliance in ways that are practical, regulatorily sound, and operationally impactful," said Adam Shapiro, Co-Founder and Partner, Klaros Group.

He added: "Third-party risk management is one of the areas where banks are under real pressure to do more, faster, and with greater consistency. Kobalt brings a market-leading AI platform to that challenge, and when combined with Klaros' deep regulatory expertise, it creates a powerful solution for institutions like MVB. Together, we can help banks strengthen oversight, improve efficiency, and reduce the cost and complexity of managing third-party risk."

For Kobalt, the MVB deployment adds another regulated financial institution to its customer list as banks look for software that can standardise review processes without expanding compliance teams at the same pace. For MVB, the project is intended to streamline partner reviews while reinforcing confidence in its ability to meet regulatory expectations across its fintech relationships.