- Chime — a company that offers mobile banking services through mobile devices — announced it has raised $485 million in funding at a massive $14.5 billion valuation
Chime — a company that offers mobile banking services through mobile devices — announced it has raised $485 million in funding at a massive $14.5 billion valuation, according to CNBC. This makes Chime the most valuable private financial tech startup followed by Robinhood at $11.2 billion.
With this funding round, Chime has more than doubled its valuation from December and now it is worth nearly 900% more than what it was at about a year and a half ago when it was at a $1.5 billion valuation. Chime CEO Chris Britt told CNBC that the company has more than tripled its transaction volume and revenue this year.
“Nobody wants to go into bank branches, nobody wants to touch cash anymore, and people are increasingly comfortable living their lives through their phones,” said Britt via CNBC. “We have a website, but people don’t really use it. We’re a mobile app, and that’s how we deliver our services.”
During the pandemic, Chime became profitable on an EBITDA basis. And Chime is now adding hundreds of thousands of accounts every month. It is unknown how many total users are on Chime.
Chime eventually plans to go public. And Britt indicated that this could happen within about a year so. Britt said that he gets calls from two SPACs a week so find out if the company wants to go public soon, but the company has a number of initiatives that they want to complete before feeling like they are market-ready.
How does Chime work? Chime essentially gives customers no-fee mobile banking accounts and debit cards along with ATM access. The service is especially popular with people who have incomes of about $30,000 to $75,000 per year. Chime generates most of its revenue from customer swiping debit and credit cards whereas regular banks mostly generate revenue from penalties such as overdraft fees and loans.