Stash, a quickly growing saving and investment platform, is now offering consumers an extensive suite of banking products thanks to a partnership with Green Dot Bank.
The startup and member FDIC announced this month their launch of “mobile-first banking services,” including bank accounts with debit cards, no overdraft fees, and a large network of free ATMs nationwide.
Green Dot, known for its debit card issuing entity, also provides the backend payments technology for Apple Pay Cash and Uber, among others.
“Stash is committed to being a true partner and source of support for our clients, and for those who have systematically been left behind,” Brandon Krieg, CEO and cofounder of Stash, told Crunchbase News. “Layering Green Dot’s robust Banking as a Service platform with Stash’s full suite of offerings will provide innovative, affordable tools to teach healthy financial habits, relieve financial stress, and help our clients save and invest more money.”
Stash, known for its personal finance advisement on saving and investing, currently counts two million banking customers and five million financial educational subscribers with a growth rate of 40,000 new clients per week. The New York-based company closed its Series D in February, raising $37.5 million from the likes of Valar Ventures and Union Square Ventures.
This partnership may signal a turning point for the fintech and alternative banking scene, which has seen considerable growth within the past few years. The fact that a fairly young startup such as Stash is beginning to offer robust banking products with the help of an established financial institution is only one piece of the puzzle.
With the growth of Simple bank in recent years—which was acquired by Spanish BBVA in 2014—along with the arrival of U.K. based online bank Revolut Stateside this year, it’s clear this emerging scene is looking to cement its status as a financial category in the coming years. Revolut has already proven popular over in its home country and Europe, becoming the first British app-only bank to break even without profit loss this year. Its competitor Monzo has seen similar success in the U.K. and international markets among young users.
However, it’s not just Stash that has turned banking digital. Millennials are turning away from scandal-ridden big banks, and FinTech’s most prominent startups are in a prime position to take advantage of that exodus. The recent rise of young activists’ desire to use bank as political protest is a contributing factor to the rise in alternative banking. For example, the current grassroots movement “Defund DAPL” calls for young folks to divest their assets away from Wall Street banks known to invest in the Dakota Access Pipeline.
In short, millennials have already taken the plunge into investment apps such as Acorns and Stash. Now they are ready to forego brick-and-mortar banking altogether in favor of personalized digital banking experiences catering to them.