Stripe leads $22.5m funding round for teen banking startup Step to target pre-banked population
Step is a teenager-focused US mobile banking startup that has built up a half million-strong waitlist in a matter of months.
In the week that JPMorgan Chase shut down its millennial-focussed mobile venture Finn, Step has pulled together a host of glitzy backers. Stripe was joined in the round by famous names including movie star Will Smith, through his Dreamers fund, and rapper Nas.
But what Step id planning? Step is building a mobile-based bank account - held with Evolve Bank - specifically designed for teens that is interest bearing and has no hidden or overdraft fees. Sounds interesting, since it seems that when the customers hit 18, they will still be able to use Step. What is happening here - is simply reaching to pre-banked group and hooking them before they will HAVE TO open bank account.
The mobile app is linked to a Mastercard and lets users send and receive money instantly, shop online or in-store as well as use Apple Pay and Google Pay. Strip is providing issuing and processing technology. SO what is the parents role? Parents get oversight into their teen’s spending, providing the opportunity for them to set limits and guidelines as well as have a view into card use.
Step will use the new funding to make hires and accelerate its roadmap as it gets ready for launch, taking on what it calls the "pre-banked" population.
"We’ve partnered with the best in the business to create the right solutions for the next generation. As we move into a cashless era where digital content and transactions fuel our daily lives, the need for innovation in financial services increases. We want Gen Z to be more equipped and educated when it comes to money."
I would add here - we want Gen Z to be our customers in future, as soon they will start earning money :) Well, business is business.
Contributed | This content is contributed or sourced from third parties but has been subject to FTHours editorial review. Source: Finextra