Neo banks (a fancy term to describe upstart digital banks working on everything from savings and checking accounts to mobile debit cards) focus on bringing banking services to users both underbanked and not.
But, notably, it’s not just startups that started off life looking to build a neo bank who are building out banking-like services.
It’s a leading company in the neo banking rush, which, suddenly, is looking more and more like a crowded race as participants of all sorts join the fray.
Crunchbase News was tipped off about the boom last year when covering Acorns, a company that was initially focused on providing a savings service to users.
Acorns moved into the banking space with a debit card in mid-2018, and at the same time, was hunting a $100 million round at a valuation of $700 million move, which we wrote about, too.
Skipping all the technical talk, interchange fees effectively allow companies like Acorns and Chime to charge a small fee when one of their customers uses one of their debit cards.
In short, lots of startups that started somewhere else in the world of finance have slowly come to circle more traditional banking services as a way to add growth to their businesses.
The Acorns example is canonical in some ways, but also nearly too simple; the startup was already focused on a savings product, adding a way for its users to spend some of their money wasn’t a hugely surprising move.
Betterment also put together banking accounts and debit cards for its users this year.
The well-funded startup has launched cash management accounts and a debit card.
The team will also roll out a digital wallet and connected bank accounts in the coming year, per a blog post from the company.
Most recently, the San Francisco company has created a new offering to compete with traditional banks: cash.
Brex Cash was created to minimize the expense and time of wiring money through a traditional bank.
The last time we caught up with Henry Dubugras, a co-founder of Brex, he said the company is looking to be a bank account replacement.
Stripe, after adding lending services, is rolling out a corporate charge card.