This year, SoFi, Betterment, Wealthfront, Robinhood, and CreditKarma have all made plays into some sort of high-yield account with at least a 2% annual percentage yield. The national average for example on savings accounts.com. Wealthfront's cash account has attracted more than $7.5 billion in deposits since launching in February. Co-founder Dan Carroll told CNBC it's "going to be really difficult for incumbent firms to pivot to compete on interest rates overnight.
PwC Financial Services Advisory Leader Julien Courbe said part of the reason fintech companies are able to offer higher rates for their deposit products is because their customer acquisition costs are lower. Their eye-popping APY can be especially attractive to customers who are shopping based on rates alone.
Regional banks, meanwhile, are scrambling to compete with the big four and trying "more aggressive" tactics, he said. "In order to do this, they need to create more attractive deposits."
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