Hey, fintech fam 💜

I can’t lie, it’s been a hard few days. Last week, Anton and I had to say goodbye to our cat Alice.

She lived an incredible 16 years. Basically, half my life has been lived with Alice by my side.

The hardest moments are in the quiet at home, when you expect to see her coming around the corner or jumping on your keyboard at the most inconvenient times.

There’s lots of change and exciting things happening over at Fintech is Femme HQ, but moments like this put what matters into perspective.

(If you’ve lost a pet, I’d love it if you replied to this email with your best tips and tricks to get through this process!)

I’m excited for today’s story. My friend and Academy of Fintech member, Fei Han, is taking over the newsletter and talking about the next phase of neobanks.

Let's get into it. ✨

If you recall, Chime spent its early years as the app where your paycheck shows up two days early.

Now it wants to be where a slice of that paycheck gets invested. On July 20, Chime announced Chime Invest: commission-free trading in stocks and ETFs inside the same app members already use to get paid, spend, and save.

If you take it as product news, here’s one more banking app adding an investing feature.

As a strategic move, however, this is the clearest sign yet that the neobank story has outgrown the debit card.

Neobanking’s first decade tried to answer one question: can an app reduce some frictions and make the banking experience better?

The next decade tries to answer a much harder one: can these companies become the customer’s primary financial relationship?

Plenty of products can imitate banking’s surface, but very few can rebuild its trust and habitual engagement needed to make the economic model durable.

An occasional user who keeps a small balance and uses their card every now and then is simply taking advantage of some features; a customer who direct-deposits their paycheck, spends regularly, saves, borrows, and invests all in one place is the real franchise.

That is what makes Chime Invest strategically interesting.

Chime states the average member engages with the app five times a day and transacts more than fifty times a month - the company already has frequency and distribution, and investing is simply the latest category it can add to an already established customer relationship.

Revolut arguably shows how far adding categories to one established relationship can go, making it an interesting case study. The platform built its reputation in its early days as the go-to overseas travel card; this year it’s applying to become an American bank with a wide range of offerings:

Ambition of this magnitude tends to attract a familiar criticism: neobanks are merely products wrapped in a cool user interface and reliant on venture-subsidized customer acquisition.

But Revolut's numbers reveal a different picture: profits and revenue can be delivered once a meaningful relationship stack with users is established.

Revolut’s 2025 pretax profit hit a record £1.7 billion, up 57%, on £4.5 billion of revenue.

And particularly on this print, one detail many people find interesting: even after its loan book doubled to £2.2 billion, Revolut’s loan-to-customer-deposit ratio stood at only 6.2%.

In other words, it essentially remains a machine for gathering deposits and driving user engagement, while its monetization of credit (and potentially other features) is still in its infancy.

Revolut’s business model might not be apples-to-apples for its US peers, as it was partially shaped by the market it came from, where interchange fees are capped by regulation.

This creates incentives for neobanks to seek banking licenses early on to diversify beyond purely card revenue.

Most US neobanks, however, grow up inside partner-bank structures where interchange fees drive the economics.

But even though the vast majority of US neobanks still don't hold their own charters, what they are building first is the thing a license eventually monetizes: the primary banking relationship – and that usually starts with the paycheck.

In the US, Chime and Cash App are taking different paths towards the same destination.

Take a step back from the latest Chime Invest news for a moment, and let’s look through some other Chime headlines this year - Chime built its reputation on debit-first everyday banking for Americans who rely more on debit than credit.

Early direct deposit, low fees, overdraft alternatives, and credit builders have been the pillars of the brand, with interchange doing the heavy lifting on the revenue side.

The evolution continued. In Q1 2026, Chime’s first quarter of GAAP profitability as a public company, some numbers were hard to ignore:

Platform-related revenue was up 50%, driven by MyPay and Instant Loans ($180 million originated in Q1 alone).

It would be easy to frame this as “Chime has been adding lending products” over the past few years, but that misses what’s actually going on.

These are paycheck-timed liquidity products, tools built for consumers whose cash-flow data could tell a more complete story than a traditional bureau file sometimes could.

The model has already shown Chime can monetize engagement beyond the card.

Chime Invest now takes that same approach and tries to push it in a new direction. But the core question remains the same - occasional use, or a regular part of the user’s cash management cycle?

That distinction matters when you’re weighing long-term franchise value – and Chime has already made its broader primary-account ambition explicit: in April, it launched a premium tier, Chime Prime, aimed at members who make Chime their primary financial partner.

Cash App is running a similar playbook, but pushing the credit side of it even further.

Reuters reported in May that Cash App’s gross profit rose 38% year over year, while Block’s consumer lending origination volume surged 82% to $17.6 billion, underpinned by strength in Cash App Borrow.

Block also said it was in the early stages of extending BNPL functionality across Cash App. It ended March with 9.7 million “primary banking actives” - users who deposit a paycheck or spend at least $500 a month in the app - a figure that was up 18% year over year.

Borrow is straightforward: up to $500, instantly, with eligibility tied to paycheck or linked-account deposits, card usage, Cash App balance, and account standing.

No credit check, no bureau reporting.

The next layer is Cash App Score. The Wall Street Journal reported that Block planned to show users the internal score it uses to decide eligibility for small-dollar loans, while keeping much of its lending footprint outside the traditional credit-reporting system.

Block has since launched a pilot for select customers. Block says its credit models draw on near-real-time financial behavior, including paycheck deposits, cash-flow patterns, spending habits, and repayment history, with the stated goal of expanding access in a responsible way.

In some sense, that is credit infrastructure built from first-party cash-flow and repayment data, and Block says it works: more than 70% of active Cash App Borrow customers have FICO scores below 580, yet repayment rates stay above 97%.

The risk is just as real: that credit history is locked inside a single company's closed ecosystem, and the same entity doing the advance is also the one keeping score.

Then there’s X Money.

It went live for a subset of US Premium+ users in late June, about a year and a half after X announced its Visa partnership: peer-to-peer payments, a debit card, FDIC-insured deposits held at partner banks, and an aggressive advertised savings yield.

You probably can’t call X a neobank yet, but it belongs in this story, because it shows where this is all headed - where attention goes, payments can follow; where payments go, balances follow; and where balances go, credit, investing, and many more use cases will follow.

The next competitor for the primary banking relationship might just first look like a social app.

Strip away all the product announcements and what you’re really looking at is a single competition with four different ways to enter:

Different starting points, same destination: the center of the consumer’s financial life.

From where I sit, the most enduring franchises rarely offer the longest product list. They are the ones that transform products into habitual behavior and give customers reasons to keep coming back at different points in their financial lives.

It’s the next fight over where money lives.

Fei Han is an investment professional focused on private asset-backed finance, with experience spanning investing, fintech capital markets strategy, and sell-side research. She serves on the board of the MIT Sloan Club of New York, where she leads the alumni network's fintech initiative.

She also contributes to the broader fintech ecosystem through various industry initiatives and community-building efforts.

Want to hear more about moves like Chime Invest directly from Chime’s executive team? Join us at FTW:SF! Get VIP tickets for backstage access.

These are the feels this week. Love and miss you, Alice! 🐈 (Alice was gray, but this emoji is close enough.)

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Thanks for spending time with Fei and me today!

Love,

Nicole 💜