And nixing fees and spending a lot on marketing squeezes margins, making profitability even more difficult to attain. But despite that, Chime CEO Chris Britt claims the neobank could be profitable today if it reduced its marketing budget, per Forbes.
This relatively solid footing may be a result of convincing a large segment of its customer base to make direct deposits with the bank: More than 1 million customers have their paychecks sent to their Chime debit account, a source told Forbes, and if those clients are depositing their paychecks with Chime, they are much more likely to use their Chime card for transactions, driving interchange revenue for the neobank.
Going forward, Chime has plans to roll out several new banking products that could benefit its bottom line if it can cross-sell them to customers. Chime plans to launch a credit card in the first half of 2020 with personal loans and investment services on deck for the more distant future, Britt told Forbes.
These new products will give Chime additional opportunities to get greater value out of customers it can cross-sell them to, helping the neobank's profitability prospects in the long run., Business Insider Intelligence's expert product suite tailored for today's decision-makers in the financial services industry, delivered to your inbox 6x a week. >>
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