SMB Fintech Stack (Source: Canapi)

The first pure-play online bank Security First Network Bank (SFNB) launched in 1995, just a year after Amazon.com. But unlike ecommerce, digital-only banking was slow to catch on. The legacy players held their market share by providing digital services deemed “good enough” to retain customers loath to switch banks.

But that began changing about 6 or 7 years ago, first in the UK, then elsewhere as well-financed digital players started making inroads with consumers. There was Monzo, Revolut, Starling, Nubank, Chime, just to name a few. But we still haven't seen a breakout small business bank, partly because of the love/hate relationship business owners have with big banks.

In the adjacent SMB lending space (see our Top 30 Digital Lender's list), top brands such as Kabbage (now American Express), Square, Paypal, Amazon, Brex, and others have grabbed significant share. But there is not yet a place where small businesses flock to get deposit, payment, and financing needs met in a single interface. Brex was probably the closest, but it recently abandoned the SMB market to focus on larger enterprises.

So who are the best digital challenger business banks? Let's start with our definition.

  1. Centered around deposit and debit/charge card services (eliminates Kabbage and most SMB lenders)
  2. Predominantly focused on small-business financial services (eliminates Paypal, Amazon, Block)
  3. Primarily digitally delivered (rules out Wells Fargo, BofA, and the majority of traditional banks*)
  4. Founded since 1999.

*Note: We also include divisions of traditional FIs if they operate under a separate autonomous brand, such as Zions ZiFi.

For the latest table, check our Challenger Bank table

Challenger of the Month

Mercury Bank

HQ: SF  |  Founded: 2017  |  Raised $136M (including $120M in 2021)  |  Website visits: 1.2 million (May '22)  | Employees: 312  |  Article citations: 13  |  Linkedin: 12,200 followers | Trustpilot: 3.9 (433 reviews) | iOS app: 4.7 (660 reviews)

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NEW: Looking for digital banks, lenders, payment providers, insurance or digital accounting for small businesses? Check out our latest lists: SMB online lenders (33) | SMB challenger banks (12) | SMB insurers (15) | SMB charge cards/expense management (16) | Billpay & invoicing (16)| Payment processors (7) | Subscription processors (7) | SMB digital accounting/bookkeeping (21)

The FAB Score Ranking (Fintech Attention Barometer) is a proxy for the size of a private fintech company.



Leading USA digital small business banks
ranked by our FAB score (Fintech Attention Barometer*)

Rank Company FAB* Reviewed Founded HQ Funding ($M)** Visits (June '22)
1 Mercury 307 9-Aug-2022 2017 SF $152 1,200,000
2 NOVO 297 9-Aug-2022 2016 NYC $136 1,200,000
3 Found 185 9-Aug-2022 2019 SF $75 720,000
4 Oxygen 167 9-Aug-2022 2018 SF $25 800,000
5 Nearside (Hatch) 125 9-Aug-2022 2018 SF $77 450,000
6 Rho 116 9-Aug-2022 2018 NYC $205 61,000
7 Lili 72 9-Aug-2022 2018 NYC $80 190,000
8 Relay FI 57 9-Aug-2022 2018 Toronto $19 230,000
9 Grasshopper 37 9-Aug-2022 2016 NYC $161 12,000
10 NorthOne 32 9-Aug-2022 2016 NYC $23 140,000
11 Winden 25 9-Aug-2022 2021 LA $5 93,000
12 Baselane 18 9-Aug-2022 2020 NYC $8 43,000
13 ZilBank 13 9-Aug-2022 2021 Dallas $0 33,000
14 Vergo 9 9-Aug-2022 2021 NYC $4 2,100
Unlaunched
Zifi (Zions Bank) NA 9-Aug-2022 2022 Utah $0 0
Nophin NA 9-Aug-2022 2021 NYC $3 0
Guava NA 9-Aug-2022 2018 NYC $0 0
Kuma (seems dorment) NA 9-Aug-2022 INA LA INA 0

Source: FintechLabs, Pitchbook, Crunchbase, SimilarWeb, SEMrush; 9 Aug 2022

* The FAB score, Fintech Attention Barometer, is a proxy for the overall size of a private company since they typically do not release traditional metrics (# customers, deposits, AUM, etc). The score is based on VC funding, website traffic, mobile downloads, and the number of employees. It's a work in progress, so expect changes in the formula.
**Funding is the amount invested into the company as either equity or debt.
***Our business model depends on revenue from referrals. So anytime you see a referral link in the URL, we potentially earn a fee upon establishing a new funded account (thanks!).


Challenger SMB Banks Currently Active in the United States


1. Mercury Technologies
FAB Score = 307
– HQ: San Francisco Bay Area
– Founded: 2017
– Raised $152M (Crunchbase) including $120M in 2021
– Website visits: 1.2 million (June 2022; SimilarWeb)
– Employees: 380 (Pitchbook)
– Articles: 13 (Crunchbase)
Linkedin: 12,500 followers (385 employees)
Twitter: 15,200 followers
Trustpilot: 4.0 (439 reviews)


2. Novo
FAB Score: 297
– HQ: NYC
– Founded: 2016
– Raised $136M including $131M in 2021 (Crunchbase)
– App downloads (last 30 days): 56,000 (Apptopia)
– Website visits: 1.2 mil (June 2022; SimilarWeb)
– Employees: 269 (Pitchbook)
– Articles: 90 (Crunchbase)
Linkedin: 12,300 followers (270 employees)
Twitter: 2,200 followers
– Industry awards: 4 (Novo)
– Integrations: Wise, Xero, Slack
TrustPilot: 3.4 (1,160 reviews)
iOS app: 4.8 (11,100 reviews)

3. Found 
FAB Score = 185
– HQ: San Francisco Bay Area
– Founded: 2019
– BaaS partner: LendingClubBank
– Raised $75.2M ($60M in Feb 2022; $12.75M in 2021) (Crunchbase)
– Website visits: 720,000 (SimilarWeb, June 2022)
– Employees: 68 (Pitchbook)
– Articles: 0 (Crunchbase)
Linkedin: 2,000 followers (69 employees)
Twitter: 663 followers
Trustpilot: 2.6 (7 reviews)
iOS: 4.8 (4,400 reviews)


4. Oxygen
FAB Score = 167

– HQ: San Francisco Bay Area
– Founded: 2018
– Raised $24M prior to 2021 (Crunchbase)
– Website visits: 800,000 (SimilarWeb, June 2022)
– Employees: 86 (Pitchbook)
– Articles: 21 (Crunchbase)
Linkedin: 4,900 followers (91 employees)
Twitter: 1,700 followers
Trustpilot: 2.4 (105 reviews)
iOS app: 4.8 (20,800 reviews)

5. Nearside (formerly Hatch)
FAB Score = 125
– HQ: SF
– Founded: 2018
– Raised $77M including $58M in 2021 (Crunchbase)
– Website visits: 450,000 (SimilarWeb, June 2022)
– Employees: 99 (Pitchbook)
– Articles: 5 (Crunchbase)
Twitter: 759 followers
Linkedin: 1,400 followers (103 employees)
– TrustPilot: no reviews
iOS: 4.3 (145 reviews)


Image

6. Rho
FAB Score = 116
– HQ: NYC
– Founded: 2018
– Raised $205M including $200M in 2021 (Crunchbase)
– Website visits: 61,000 (SimilarWeb, June 2022)
– Employees: 128 (Pitchbook)
– Articles: 21 (Crunchbase)
Linkedin: 3,900 followers (173 employees)
Twitter: 844 followers
– Trustpilot: No reviews

 


7. Lili
FAB Score = 72
– HQ: NYC
– Founded: 2018
– Raised $80M (Crunchbase)
– Website visits: 190,000 (SimilarWeb, June 2022)
– Employees: 70 (Pitchbook)
– Articles: 17 (Crunchbase)
Linkedin: 7,500 followers (86 employees)
Tiktok: 240,000 followers; 600,000 likes
Trustpilot: 4.0 (181 reviews)

8. Relay FI
FAB Score: 57
– HQ: Toronto
– Founded: 2018
– Partner bank: Evolve
– Raised $19.4M including $15M in 2021 (Crunchbase)
– Website visits: 230,000 (SimilarWeb, June 2022)
– Employees: 56 (Pitchbook)
– Articles: 3 (Google News)
Linkedin: 2,500 followers (78 employees)
Twitter: 840 followers
TrustPilot: 4.5 (508 reviews)
iOS: 4.5 (153 reviews)

9. Grasshopper Bank
FAB Score = 37

– HQ: NYC
– Founded: 2016
– Raised $162M including $30M Aug 2022 (Crunchbase)
– Website visits (May 2022): 12,000 (SimilarWeb)
Employees: 100 (Pitchbook)
– Citations: 12 (Crunchbase)
Linkedin: 13,500 followers (99 employees)
Twitter: 817 followers
– Trustpilot: No reviews


10. NorthOne
FAB Score: 32
– HQ: NYC/Toronto
– Founded: 2016
– Raised $23.3M prior to 2021 (Crunchbase)
– Website visits: 140,000 (SimilarWeb, June 2022)
– Employees: 103 (Pitchbook)
– Articles: 19 (Crunchbase)
Linkedin: 7,300 followers (90 employees)
Twitter: 2,530 followers
TrustPilot: 3.3 (119 reviews)
iOS app: 4.8 (2,400 reviews)


11. Winden
FAB Score = 25
– HQ: LA
– Founded: 2021
– Raised: $5.3M (Crunchbase)
– Employees: 15 (Linkedin)
– Articles: 2 (Crunchbase)
– Website visits: 93,000 (SimilarWeb, June 2022)
Linkedin: 230 followers (15 employees)


12. Baselane
FAB Score: 18
– HQ: NYC
– Founded: 2020
– Raised: $7.9M in 2021 (Crunchbase)
– Employees: 26 (Linkedin)
– Articles: 4 (Crunchbase)
– Website visits: 43,000 (SimilarWeb, June 2022)
Linkedin: 1,020 followers (26 employees)


13. Zilbank
FAB Score = 13
– HQ: Dallas, TX
– Founded: 2021
– Raised: INA (Crunchbase)
– Employees: 2 (Linkedin)
– Articles: 5 (Crunchbase)
– Website visits: 33,000 (SimilarWeb, June 2022)
– Linkedin: 48 followers (2 employees)


14.Vergo
FAB Score = 9
– HQ: NYC
– Founded: 2021
– Raised $4.2M including $4.1M in June 2022 (Crunchbase)
– Website visits (July 2022): 2,100 (SEMrush)
Employees: 23 (Linkedin)
– Citations: 1 (Crunchbase)
Linkedin: 493 followers (23 employees)
– Trustpilot: NA

 


Unlaunched

Zifi (Zions Bank)
– HQ: Salt Lake City, UT
– Founded: 2022
– Raised: NA (unit of Zions Bank)
– Website visits (June 2022): 7,500 (SEMrush)
Linkedin: 20 followers (3 employees)

 

Guava
– HQ: NYC
– Founded 2018
– Raised: $2.4M in July 2022 (Crunchbase)
– Website visits (Julu 2022): 1,500 (SEMrush)
– Employees: 8 (Pitchbook)
Linkedin: 890 followers (9 employees)

 


Challengers Closed to New Accounts


Solid (was Wise) >> pivoted to Fintech as a Service in 2021
FAB Score: 386
– HQ: SF
– Founded: 2018
– Raised $18M prior to 2021 (Crunchbase)
– Website visits: 1.9 million (Mar 2022; SEMrush)
– Employees: 126 (Pitchbook)
– Articles: 4 (Crunchbase)
Linkedin: 2,020 followers (56 employees)

 


14. Joust (acquired by ZenBusiness, 30 July 2020; currently referring customers to Radius Bank)
– Target: Freelancers
– HQ: Austin, TX
– Founded: 2017
– Raised: $11M (Crunchbase)
– Website visits: Unknown
– Employees: 18 (Pitchbook)
– Citations: 5 (Crunchbase)
– Twitter followers: 448
– Trustpilot: NA
– iOS: 4.1 (28 reviews)


15. Seed (Acquired by Cross River Bank currently closed to new customers)
– HQ: San Francisco Bay Area
– Founded: 2014
– Raised $5.2M (2015) (Crunchbase)
– App downloads (last 30 days): 425 (Apptopia)
– Website visits: 210 (May 2021; SEMrush)
– Number of employees: 12 (Pitchbook)
– Citations: 4 (Crunchbase)
– Twitter: 810 followers


Addendum: Other SMB/SME challenger banks around the world (not a definitive list):

UK

Germany

Australia

France

Rest of world