Other than a brief spike in 2018, it’s been 15 years since short-term rates were high enough for most small-to-medium-size businesses (SMB) to care about chasing yield on their parked cash. But that’s changed dramatically in the past 6 months. With “risk-free” rates pushing 5%, even a business with $50k in reserve (throwing off $200/mo) has the incentive to sweep that out of a non-interest checking account.
Are we about to see a rush of fintech startups serving the interest-sensitive small business market? Maybe, maybe not. It depends on whether VCs believe we’ll have a long-term run of rates higher than 3%. But what we will surely see is challenger banks dusting off their sweep features and emphasizing them in their marketing and branding.
Case in point: Just days after the Feds took over SVB, Mercury was in the market with Mercury Vault, offering $5 million in FDIC insurance by distributing balances across 20 insured banks. We’ve also seen the launch of QED-backed Meow, with an FDIC-deposit-aggregation service, Maximum Checking with up to $125 million of FDIC insurance (through the sweep network of FirstBank).
Challenger of the Month*
Maximum Checking provided by FirstBank, a Tennessee corporation, Member FDIC.
* See applicable rate sheet at www.meow.com/rate-sheets. Interest rates and yields are effective as per the date on the rate sheet and are subject to change without notice. For more information on FDIC insurance eligibility, review our Terms of Service (www.meow.co/terms-of-service) and the disclaimers at the footer of meow.com**
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** Meow Technologies is a financial technology company, not a bank or FDIC- depository insured institution. The banking services described in this message are provided by FirstBank, a Tennessee corporation; Member FDIC. If you hold these funds in a sweep program, your funds are automatically swept across a network of FDIC- insured banks in increments of up to $250,000 per bank through the sweep network of FirstBank, a Tennessee corporation; Member FDIC for up to $125 million. The FDIC’s deposit insurance coverage only protects against the failure of an FDIC-insured bank
Looking for digital banks, lenders, payment providers, insurance or digital accounting for small businesses? Check out our latest lists: SMB online lenders (34) | SMB challenger banks (15) | SMB insurers (15) | SMB charge cards/expense management (18) | Billpay & invoicing (21)| 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.
Highest-Rate Online Savings Banks for Small Businesses
| Rank | Company | FAB* | APY (1Aug’24)** | Min Balance** | Founded | HQ | Funding $M*** | Visits (Jun’24) |
|
FDIC-insured deposits
|
||||||||
| 1 | Meow | 27 | 4.80% | None | 2021 | NYC | $27 | 39,000 |
| 2 | Mayfair | 13 | 4.72% | $2.5k | 2021 | SF | $14 | 1,500 |
| 3 | Baselane | 53 | 4.19% | None | 2020 | NYC | $7 | 220,000 |
| 4 | Lili | 64 | 4.15% | None | 2018 | NYC | $80 | 150,000 |
| 5 | Live Oak Bank | 51 | 4.70% | None | 2008 | Wilmington, NC | $157 | 180,000 |
| 6 | Relay | 209 | 3.00% | $1M | 2018 | Toronto | $51 | 910,000 |
| 7 | Grasshopper | 49 | 2.25% | $25k | 2016 | NYC | $173 | 45,000 |
|
U.S. Treasuries
|
||||||||
| Zamp | 20 | Unknown | Unknown | 2022 | India | $25 | 1,500 | |
| Meow | 27 | Unknown | $1M | 2021 | NYC | $27 | 39,000 | |
| Brex | 545 | 4.92% | Unknown | 2017 | SF | $1,200 | 830,000 | |
| Other | ||||||||
| Mercury | 447 | 5.35% | $20M | 2017 | SF | $152 | 1,900,000 |
Source: FintechLabs, Crunchbase, SimilarWeb, 2 June 2024
FDIC-insured Deposits**
1. Meow
FAB Score: 27 (up 5 from May)
– HQ: NYC
– Founded: 2021
– Banking service providers: FirstBank, Grasshopper Bank, Third Coast Bank
Rates (APY)
Top: 4.80% FDIC-insured deposits (updated 2 July 2o24, requires payroll and accounting integration, otherwise 4.0%; also requires $100,000 balance otherwise rate is 2% less)
Treasuries: Not disclosed
Minimum Balance: $100,000 for FDIC-insured deposits, $1M for Treasury
Traction
– Raised: $27 million (Crunchbase)
– Employees: 27 (Pitchbook), unchanged since May
– Website visits: 39,000 (SimilarWeb, June 2024)
– Linkedin: 7,000 followers
2. Mayfair
FAB Score = 13 (down 1 since May)
Founded: 2021
HQ: San Francisco
Rates (APY)
Top APY: 4.72%
Minimum balance: $2,500
Traction
Funding: $14M (Crunchbase)
Employees: 120 (Linkedin), up 11 since Oct
Website traffic: 1,500 (June 2024, SimilarWeb)
Articles: 1 (Crunchbase)
Linkedin: 980 followers (159 employees, up 12 since May, up 39 since Feb, up 50 since Oct ’23)
3. Baselane
FAB Score: 53 (up 20 since May)
HQ: NYC
Founded: 2020
Rates (APY)
Top APY: 4.19%
Minimum Balance: none
Traction
– Raised: $7.9M in 2021 (Crunchbase)
– Website visits: 220,000 (SimilarWeb, June 2024)
– Employees: 41 (Pitchbook), up 5 since May, up 10 since Feb, up 12 since Oct ’23
Social
– Articles: 5 (Crunchbase)
– Linkedin: 2,000 followers (43 employees, up 2 since May, up 10 since Feb, up 14 since Oct ’23)
4. Lili
FAB Score = 64 (down 18 since May)
HQ: NYC
Founded: 2018
Banking service provider: Choice Financial Group
Rates (APY)
Top: 4.15%
Minimum Balance: none
Maximum balance: $100,000 (no interest above $100,000)
Traction
– Raised $80M including $55M in 2021 (Crunchbase)
– Website visits: 150,000 (SimilarWeb, June 2024)
– Employees: 88 (Pitchbook), up 1 since May, down 17 since Feb
Social
– Articles: 20 (Crunchbase)
– Linkedin: 14,000 followers (95 employees, up 7 since May, down 136 since Feb)
– TikTok: 235,000 followers; 600,000 likes
– Trustpilot: 4.7 (3,180 reviews, up 80 since May)
5. Live Oak Bank
FAB Score = 51 (down 2 since May)
HQ: Wilmington, NC
Founded: 2008
Rates (APY)
Top: 4.70%
Minimum Balance: none
Traction
Raised: $152 million (Crunchbase)
Revenue (TTM): $451M (Yahoo)
Valuation: $1.9B (Public; 1 Aug 2024)
Website visits: 180,000 (Similarweb, June 2024)
Employees: 925 (Pitchbook), unchanged since Feb, up 39 since October
Social
Articles: 28 (Crunchbase)
Linkedin: 20,000 followers (975 employees, up 13 since May, up 50 since Feb and Oct ’23)
Trustpilot: 4.4 (783 reviews, up 339 since Feb)
6. Relay
FAB Score: 209 (up 70 since May)
– HQ: Toronto
– Founded: 2018
– Partner bank: Thread
Rates (APY)
Top: 3.0%
Minimum Balance: $1 million
Maximum balance: NA
Other tiers:
<$50,000 = 1%
$50,000 to $250,000 = 1.5%
$250,000 to $1 million = 2.0%
Traction
– Raised $51.6M including $32M in May 2024; $15M in 2021 (Crunchbase)
– Website visits: 910,000 (SimilarWeb, June 2024)
– Employees: 199 (Pitchbook), up 3 since May, up 57 since Feb, up 71 since October ’23
Social
– Linkedin: 9,000 followers (212 employees, up 14 since May, up 65 since Feb, up 86 since October ’23)
– TrustPilot: 4.6 (1,720, up 90 since May)
– iOS: 4.8 (1,300 reviews, up 200 since May)
7. Grasshopper Bank
FAB Score = 49 (unchanged)
HQ: NYC
Founded: 2016
Rates (APY)
Top: 3.75%
Minimum Balance: $25k
Traction
– Raised $172M including $11M in Jan 2024; $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: 45,000 (SimilarWeb, June 2024)
– Employees: 119 (Pitchbook), up 18 since Feb
Social
– Articles: 35 (Crunchbase)
– Linkedin: 26,000 followers (122 employees, up 3 since May & Feb, up 13 since Oct ’23)
– Trustpilot: 4.0 (152 reviews, up 40 since May)
U.S. Treasuries
1. Zamp
FAB Score = 21 (down 3 since Feb)
Founded: 2022
HQ: India
Rates (Yield)
Top: Not disclosed
Minimum Balance: Not disclosed
Traction
Funding: $25M (Crunchbase)
Employees: 28 employees (Linkedin)
Website traffic: 1,700 (SEMRush, June 2024); 9,000 (April 2024, SimilarWeb)
LinkedIn: 7,000 followers (51 employees, up 3 since May, up 13 since April, up 15 since Oct ’23)
2. Meow
FAB Score:22 (down 1 from Feb)
– HQ: NYC
– Founded: 2021
– Banking service providers: FirstBank, Grasshopper Bank, Third Coast Bank
Rates (APY)
Top: 4.72% FDIC-insured deposits (updated 2 July 2o24)
Treasuries: Not disclosed
Minimum Balance: $1M
Traction
– Raised: $27 million (Crunchbase)
– Employees: 27 (Pitchbook), unchanged since May
– Website visits: 39,000 (SimilarWeb, June 2024)
– Linkedin: 7,000 followers
Non-treasury securities
1. Mercury Technologies
FAB Score = 584 (up 39 from June ’24)
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)
Rates (Yield)
Top: 5.35% (NOT US Treasuries)
Minimum Balance: $20 million
Traction
– More than 200,000 customers (Techcrunch, May 2024)
– Current run rate of $4B in payments per month (Techcrunch, May 2024); $50B processed in 2022, double the $23B in 2021
– Raised $152M (Crunchbase) including $120M in 2021
– Valuation: $1.7B (based on July 2021 round); $1.6B based on Q3 ’23 secondary market sales
– Website visits: 2.8 million (June 2024; SimilarWeb) <<<< Most website traffic
– Employees: 825 (Pitchbook), up 25 since May, up 97 since March, up 144 since January, up 156 since August ’23
Social
– Articles: 20 (Crunchbase)
– Linkedin: 47,000 followers (876 up 33 since June, up 70 since May)
– iOS app: 4.9 (4,700 reviews, up 300 since June)
– Trustpilot: 3.7 (980 reviews, up 50 since June)
Notes:
* 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.
**APY: Rate observed on each bank’s website on publication date. Consult the bank’s website for current APY.
***Funding: Includes equity and debt funding per Crunchbase.
Disclaimer:
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.
