The market for these so-called 'challenger banks' has exploded in recent years as customers are drawn to seamless account openings and optimized user experiences on their apps and websites.
"Our thesis going in was that we don't swipe our debit cards all that often, and we don't think the customer base that we're focusing on does either," Zach Bruhnke, cofounder and CEO of HMBradley, told Business Insider. "A lot of our customer base uses credit cards on a daily basis." Customers can achieve as high as a 3% annual percentage yield if they save 20% of their deposits during a quarter. The current national average savings rate is 0.05%,"We'll pay you more when you save more of what comes in," Bruhnke said. "We didn't want to segment customers by how much money they had. So it was always going to be about a percentage of income. That was really important to us.
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