Chime, the digital bank, has raised its valuation triple times, passing the official mark of $1 billion this week. The company which is based at San Francisco has announced a financing round of $200 million Series D that has brought its valuation to $1.5 billion. Chime said on Tuesday that the DST Global led its investors which participated in earlier fundraising rounds. The new investors are Iconiq Capital, Coatue, General Atlantic, and Dragoneer Investment Group.
The CEO of Chime Chris Britt said that there is a demand for banking services to become more customers friendly. He added that the company thinks that there is a better method to do this and this is aligned with our members’ best interests. The bank which is only online allows the customers to deposit money and save it on the company’s platform. It also allows the customers to spend the money using a debit card without any fee. The bank earns its revenue from the transaction fees that it charges on the usage of debit card used by merchants. Through a partnership with Bancorp Bank, all accounts are FDIC insured. This partnership model is increasingly popular for the startups of financial technology that do not have their bank charters. The company said that the digital approach and zero fees have helped the bank to attract 200,000 users every month.
Chime said that from last summer when it had 1 million bank accounts, the banks, today have gone up to 3 million bank accounts. These banks are increasingly becoming popular among customers who do not wish for traditional banking options. Chime’s current valuation is the highest for any private bank in US. According to Pitchbook’s data, Chime’s C round of $70 million Series was headed by Menlo Ventures in last May where the bank was valued at a $494.73 million.