Digital bank app CEO Chris Britt on niche Chime serves, how they make money, why Americans don’t trust banks

Big banks do a pretty good job with high income, high FICO score folks who have big deposits and are credit worthy, but for most Americans, the 65% that live paycheck to paycheck, the only way that big banks can make the math work on serving them is by being very punitive on fees.

This CNBC interview with Chime CEO Chris Britt is worth checking out. Chime is a fintech banking app that’s backed by 2 FDIC insured banks, but isn’t a bank itself.

To the consumer, there’s no real difference. They’re spending, saving, etc. using Chime.

This piece also notes how Chime makes money since they’re not technically a bank:

“Most of our members use Chime for non-discretionary spend; they’re going out and shopping at Target or Amazon or Subway, and they’re using it for their everyday purchases,”Britt said.

The majority of Chime’s revenue comes from network partners like Visa when members use their cards at the point of sale.

How banking apps like Chime make money is important given Britt’s quote above.

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Reference:

– Fintech CEO Chris Britt of Chime on reasons Americans don’t trust banks