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.
- Centered around deposit and debit/charge card services (eliminates Kabbage and most SMB lenders)
- Predominantly focused on small-business financial services (eliminates Paypal, Amazon, Block
- Primarily digitally delivered (rules out Wells Fargo, BofA, and the majority of traditional banks*)
- Founded since 1999.
For the latest table, check our Challenger Bank table.
Challenger of the Month*
Startups of all sizes rely on Mercury
Introducing Mercury Vault: Protect your cash with a money market fund and up to $5M in FDIC insurance – 12x the industry standard.
HQ: SF | Founded: 2017 | Raised $136M (including $120M in 2021) | Valuation: $1.7 billion | Website visits: 1.6 million/month | Employees: 790 | Article citations: 17 | Linkedin: 24,000 followers | Trustpilot: 3.5 (613 reviews) | iOS app: 4.8 (1,900 reviews)
Resources: Looking for digital banks, lenders, payment providers, insurance or digital accounting for small businesses? Check out our latest lists: Small Business (SMB) savings/treasury accounts (7) | SMB online lenders (33) | SMB challenger banks (15) | SMB insurers (15) | SMB charge cards/expense management (16) | Billpay & invoicing (16)| Payment processors (7) | Subscription processors (7) | SMB digital accounting/bookkeeping (21)
The FAB Score (Fintech Attention Barometer) is a proxy for the size of a private fintech company.
Leading Digital Small Business Banks (United States)
ranked by our FAB score (Fintech Attention Barometer**)
| Rank | Company | FAB** | Review Date | Founded | HQ | Funding ($M)*** |
Visits (Jul ’23) |
| 1 | Mercury | 447 | 30 Aug 23 | 2017 | SF | $152 | 1.9 million |
| * | Relay | 89 | 30 Aug 23 | 2018 | Toronto | $19 | 390,000 |
| 2 | 327 | 30 Aug 23 | 2016 | NYC | $296 | 950,000 | |
| 3 | BlueVine | 260 | 30 Aug 23 | 2013 | SF | $768 | 760,000 |
| 4 | Found | 123 | 30 Aug 23 | 2019 | SF | $75 | 410,000 |
| * | Revolut | NA | 30 Aug 23 | 2015 | London | $1,700 | 10.4 million |
| 5 | Arc | 101 | 30 Aug 23 | 2021 | SF | $181 | 22,000 |
| 6 | Relay | 89 | 30 Aug 23 | 2018 | Toronto | $19 | 390,000 |
| 7 | Lili | 84 | 30 Aug 23 | 2018 | NYC | $80 | 250,000 |
| 8 | Slash | 61 | 30 Aug 23 | 2020 | SF | $19 | 230,000 |
| 9 | NorthOne | 57 | 30 Aug 23 | 2016 | NYC | $90 | 95,000 |
| 10 | Grasshopper | 51 | 30 Aug 23 | 2016 | NYC | $162 | 80,000 |
| 11 (t) | Moves | 34 | 30 Aug 23 | 2020 | Dover,DE | $14.1 | 120,000 |
| 11 (t) | Winden | 34 | 30 Aug 23 | 2021 | LA | $5.3 | 140,000 |
| 13 | Baselane | 28 | 30 Aug 23 | 2020 | NYC | $7.9 | 99,000 |
| 14 | Viably | 24 | 30 Aug 23 | 2021 | NC | $21 | 36,000 |
| 15 | ZilBank | 15 | 30 Aug 23 | 2021 | Dallas | $0 | 43,000 |
| 16 | Arival | 11 | 30 Aug 23 | 2018 | Miami FL | $10.8 | 21,000 |
| 17 | Vergo | 10 | 30 Aug 23 | 2021 | NYC | $4.1 | 8,300 |
| 18 (t) | Lance | 5 | 30 Aug 23 | 2018 | NYC | $4.7 | 400 |
| 18 (t) | Guava | 5 | 30 Aug 23 | 2018 | NYC | $2.4 | 4,800 |
Sources: FintechLabs, Pitchbook, Crunchbase, SimilarWeb; 1 Sep 2023
*Our business model depends on revenue from referrals and sponsors. When you see a referral link in the URL, we may earn a fee when a new account is started (thanks!). This can improve visibility on our website, but does not impact the company’s FAB score.
** 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.
Challenger of the Month*
Relay
SEE YOUR CASH FLOW CLEAR AS DAY
Relay is a FREE, online business banking and money management platform that helps small businesses take control of their cash flow and get crystal clear on what they’re earning, spending and saving.
HQ: Toronto | Founded: 2018 | Raised $19.4M (including $15M in 2021) | Website visits: 390,000 (July) | Employees: 128 | Trustpilot: 4.6 (1,000 reviews) | iOS app: 4.6 (520 reviews)
Challenger SMB Banks Currently Active in the United States
1. Mercury Technologies
FAB Score = 447 (up 20 since May 2023)
HQ: San Francisco Bay Area
Founded: 2017
Partner banks: Choice Financial Group, Evolve Bank & Trust, and a network of 20 banks to hold excess deposits; Patriot Bank (IO card issuer)
Traction
– More than 100,000 customers (Techcrunch, Mar 2023)
– $50B processed in 2022, double the $23B in 2021
– Raised $152M (Crunchbase) including $120M in 2021
– Valuation: $1.7B (based on July 2021 round)
– Website visits: 1.9 million (July 2023; SimilarWeb) <<<< Most website traffic
– Employees: 669 (Pitchbook), down 121 since 14 May 2023
Social
– Articles: 20 (Crunchbase)
– Linkedin: 26,000 followers (664 employees, down 203)
– iOS app: 4.9 (2,300 reviews, up 4,500)
– Trustpilot: 3.7 (622 reviews)
2. Novo
FAB Score: 327 (up 74)
HQ: NYC
Founded: 2016
Traction
– Raised $296M including $125M in Aug 2023 and $166M in 2021 & 2022 (Crunchbase) <<<<Highest funding amount
– Website visits: 950,000 (July 2023; SimilarWeb)
– Employees: 446 (Pitchbook), up 139 since May
– Integrations: Wise, Xero, Slack
Social
– Linkedin: 18,000 followers (396 employees, up 19 since May)
– Articles: 131 (Crunchbase)- Industry awards: 4 (Novo)
– TrustPilot: 4.3 (2,760 reviews, up 630)
– iOS app: 4.8 (13,500 reviews, unchanged)
3. Bluevine
FAB Score = 260 (up 8)
HQ: San Francisco
Founded: 2013
Traction
– Raised: $769M prior to 2021 (Crunchbase)
– Valuation: $1B+ (estimate)
– Website visits: 760,000 (SimilarWeb, July 2023)
– Employees: 596 (Pitchbook), up 11
– Articles: 121 (Crunchbase)
Social
– Linkedin: 53,000 followers (586 employees, down 10)
– Trustpilot: 4.1 (7,410 reviews, up 220)
4. Found
FAB Score = 123 (down 18)
HQ: San Francisco Bay Area
Founded: 2019
BaaS partner: LendingClubBank
Traction:
– Raised $75.2M including $60M in Feb 2022; $12.75M in 2021 (Crunchbase)
– Website visits: 410,000 (SimilarWeb, July 2023)
– Employees: 95 (Pitchbook), up 6
Social:
– Linkedin: 3,000 followers (95 employees, up 4)
– Trustpilot: 1.9 (17 reviews, up 2)
– iOS: 4.8 (10,600 reviews, up 2,300)
5. Arc
Fab Score = 101 (down 1)
HQ: SF
Founded: 2021
Banking services provider: Piermont Bank
Traction:
– Raised: $181M in 2022 (Crunchbase)
– Website visits: 22,000 (SimilarWeb, July 2023)
– Employees: 45 (Pitchbook), unchanged
Social:
– Articles: 2 (Crunchbase)
– Linkedin: 6,700 followers (94, up 29)
6. Relay
FAB Score: 89 (up 2)
– HQ: Toronto
– Founded: 2018
– Partner bank: Thread
Traction
– Raised $19.4M including $15M in 2021 (Crunchbase)
– Website visits: 390,000 (SimilarWeb, July 2023)
– Employees: 128 (Pitchbook), up 33
Social
– Linkedin: 4,600 followers (122 employees, up 7)
– TrustPilot: 4.6 (1,004 reviews, up 230)
– iOS: 4.6 (517 reviews, up 153)
7. Lili
FAB Score = 84 (down 4)
HQ: NYC
Founded: 2018
Traction:
– Raised $80M including $55M in 2021 (Crunchbase)
– Website visits: 250,000 (SimilarWeb, July 2023)
– Employees: 105 (Pitchbook), unchanged
Social:
– Articles: 18 (Crunchbase)
– Linkedin: 11,000 followers (218 employees, up 111 since May)
– TikTok: 240,000 followers; 600,000 likes
– Trustpilot: 4.7 (2,310 reviews, up 400)
8. Slash
FAB Score = 61 (NEW)
HQ: SF
Founded: 2020
Traction:
– Raised: $19M (Crunchbase)
– Website visits: 230,000 (Similarweb, July 2023)
– Employees: 20 (Pitchbook)
Social:
– Articles: 1 (Crunchbase)
– Linkedin: 810 followers (19 employees)
9. NorthOne
FAB Score: 57 (down 1)
HQ: NYC/Toronto
Founded: 2016
Traction:
– Raised $90M including $67M in Oct 2022 (Crunchbase)
– Website visits: 95,000 (SimilarWeb, June 2023)
– Employees: 62 (Pitchbook), down 9
Social:
– Articles: 32 (Crunchbase)
– Linkedin: 8,800 followers (62 employees, down 6)
– TrustPilot: 3.1 (123 reviews, up 9)
– iOS app: 4.7 (2,700 reviews, unchanged)
10. Grasshopper Bank
FAB Score = 51 (up 9)
HQ: NYC
Founded: 2016
Traction:
– Raised $162M including $30M Aug 2022 (Crunchbase)
– Assets: $620 million (12/31/22), 2.1x growth year over year (source: company)
– Deposits: $550 million (12/31/22), 2.2x growth year over year
– Loans: $450 million (12/31/22), 3.6x growth year over year
– Revenues: $17 million (2022), 2.4x growth year over year
– Website visits: 80,000 (SimilarWeb, July 2023)
– Employees: 101 (Pitchbook), unchanged
Social:
– Articles: 21 (Crunchbase)
– Linkedin: 19,000 followers (107 employees, up 3)
– Trustpilot: 3.5 (60 reviews, up 38)
11 (tie). Moves
FAB Score: 34 (NEW)
HQ: Dover, DE
Traction:
– Raised: $14.1M (Crunchbase)
– Website visits: 120,000 (Similarweb, July 2023)
– Employees: 40 (Pitchbook)
Social:
– Articles: 10 (Crunchbase)
– Linkedin: 2,200 followers (44 employees)
11 (tie). Winden
FAB Score = 34 (down 12)
HQ: LA
Founded: 2021
Traction:
– Raised: $5.3M (Crunchbase)
– Employees: 20 (Pitchbook)
– Website visits: 140,000 (SimilarWeb, July 2023)
Social:
– Articles: 2 (Crunchbase)
– Linkedin: 3,800 followers (17 employees, down 3)
– Trustpilot: No reviews
13. Baselane
FAB Score: 28 (up 4)
HQ: NYC
Founded: 2020
Traction:
– Raised: $7.9M in 2021 (Crunchbase)
– Website visits: 99,000 (SimilarWeb, July 2023)
– Employees: 25 (Pitchbook)
Social:
– Articles: 5 (Crunchbase)
– Linkedin: 1,500 followers (30 employees, up 4)
14. Viably
FAB Score: 24 (unchanged)
HQ: Charlotte, NC
Founded: 2016
Traction:
– Raised $21M in 2022 (Crunchbase)
– Website visits: 36,000 (SimilarWeb, July 2023)
– Employees: 33 (Pitchbook), up 4
Social:
– Articles: 1 (Crunchbase)
– Linkedin: 890 followers (34 employees, up 1)
– iOS app: NA
15. Zilbank
FAB Score = 15 (down 1)
HQ: Grand Rapids, MI
Founded: 2021
Traction:
– Funding: INA (Crunchbase)
– Employees: 3 (Linkedin), down 1
– Website visits: 43,000 (SimilarWeb, July 2023)
Social:
– Linkedin: 430 followers (3 employees, down 1)
– Articles: 5 (Crunchbase)
16. Arival
FAB score: 11 (NEW)
HQ: Miami, FL
Founded: 2018
Traction:
– Raised: $10.8M (Crunchbase)
– Website visits: 21,000 (Similarweb, July 2023)
– Employees: 41 (Pitchbook)
Social:
– Articles: 4 (Crunchbase)
– Linkedin: 14,000 followers (42 employees)
17. Vergo
FAB Score = 10 (down 6)
HQ: NYC
Founded: 2021
Traction:
– Raised $4.2M including $4.1M in June 2022 (Crunchbase)
– Website visits: 8,300 (SimilarWeb, July 2023)
– Employees: 29 (Pitchbook)
Social:
– Articles: 3 (Crunchbase)
– Linkedin: 1,200 followers (25 employees, down 4)
– Trustpilot: NA
18 (tie). Lance
FAB Score: 7 (NEW)
HQ: NYC
Founded: 2018
Traction:
– Raised: $4.7M (Crunchbase)
– Website visits: 400 (Similarweb, July 2023)
– Employees: 31 (Pitchbook)https://pitchbook.com/profiles/company/231080-68
Social:
– Articles: 7 (Crunchbase)
– Linkedin: 1,200 followers (81 employees)
18 (tie). Guava
Fab Score = 5 (unchanged)
HQ: NYC
Founded 2018
Banking services provider: Piermont Bank
Traction:
– Raised: $3.1M including $650k in Feb 2023 (Crunchbase)
– Website visits: 4,800 (SimilarWeb, July 2023)
– Employees: 10 (Pitchbook), unchanged since March
Social:
– Linkedin: 1,500 followers (16 employees, up 2)
– Articles: None (Crunchbase)
Unlaunched or No Longer Listed
LiveOak Bank (discontinued business checking Aug 2023)
FAB Score = 45 (down 6)
HQ: Wilmington, NC
Founded: 2008
Traction:
Raised: $152 million (Crunchbase)
Revenue (TTM): $392M (Yahoo)
Valuation: $1.4B (Public; 30 Aug 2023, up $100M since 14 July)
Website visits: 150,000 (Similarweb, July 2023)
Employees: 886 (Pitchbook), unchanged
Social:
Articles: 3 (Crunchbase)
Linkedin: 18,000 followers (915 employees, up 9 since May)
Trustpilot: 4.2 (70 reviews, up 37)
Oxygen (removed Feb 2023, because they appear to be more focused on consumers)
FAB Score = NA
– HQ: San Francisco Bay Area
– Founded: 2018
– Raised $45M including $20M in 2023 (Crunchbase)
– Website visits: 230,000 (SimilarWeb, Jan 2023)
– Employees: 92 (Pitchbook), down 5 since March
– Articles: 22 (Crunchbase)
– Linkedin: 5,700 followers (97 employees, up 2 since March)
– Trustpilot: 3.3 (192 reviews)
– iOS app: 4.8 (24,100 reviews)
Zifi (Zions Bank)
Pivoted to card processing provider (April 2023)
– HQ: Salt Lake City, UT
– Founded: 2022
– Raised: NA (unit of Zions Bank)
– Website visits: 24,000 (SEMrush, April 2023); 4,300 (SimilarWeb)
– Linkedin: 267 followers (12 employees, up 12 since March)
Challengers Closed to New Accounts
Nearside (formerly Hatch) (removed Feb 2023)
Note: Plastiq acquired Nearside in Nov ’22 for a reported $130M and is shutting down its banking services
FAB Score = 66 (down 2)
– HQ: SF
– Founded: 2018
– Raised $73M including $58M in 2021 (Crunchbase)
– Website visits: 8,000 (SimilarWeb, April 2023)
– Employees: 57 (Pitchbook), unchanged
– Articles: 5 (Crunchbase)
– Linkedin: 1,500 followers (24 employees, down 15 since March)
– TrustPilot: no reviews
– iOS: 4.3 (183 reviews)
Solid (was Wise) >> pivoted to Fintech as a Service in 2021
FAB Score: NA
– 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)
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)
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
- Alicia Bank – Raised $147M in Nov 2021
- CountingUp
- Allca Bank — was CivilizedBank
- Redwood Bank
- Tide – Raised $195M (through Nov 2021)
- OakNorth – Raised $1B (through Nov 2021); first SMB banking unicorn
Germany
- Kontist – Raised $48 million (through Nov 2021)
- Penta – Raised $83 million (through Nov 2021)
Australia
- Judo(public)
- Volt
- Zeller – Raised A$50M in June 2021
France
Rest of world
- Holvi – Finland: Acquired by BBVA March 2016
- Juni – Sweden: Serving ecommerce companies. Raised $21.5M A-round July 2021
- Tochka – Russia
