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**
Free wires + ACH | Multi-entity accounts | Apply in under 10mins
** 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 (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.
Highest-Rate Online Savings Banks for Small Businesses
| Rank | Company | FAB* | APY (17Jan24)** | Min Balance** | Founded | HQ | Funding $M*** | Visits (Nov ’23) |
|
FDIC-insured
|
||||||||
| 1 | Meow | 23 | 5.02%* | None | 2021 | NYC | $27 | 17,000 |
| 2 | Mayfair | 17 | 4.72% | $2.5k | 2021 | SF | $14 | 18,000 |
| 3 | Baselane | 33 | 4.19% | None | 2020 | NYC | $7 | 120,000 |
| 4 | Lili | 80 | 4.15% | None | 2018 | NYC | $80 | 230,000 |
| 5 | LiveOak Bank | 55 | 4.00% | $30k | 2008 | Wilmington, NC | $157 | 200,000 |
| 6 | Relay | 143 | 3.00% | $1M | 2018 | Toronto | $19 | 660,000 |
| 7 | Grasshopper | 45 | 2.25% | $25k | 2016 | NYC | $162 | 53,000 |
|
U.S.
|
||||||||
| Treasuries | ||||||||
| 1 | Zamp | 24 | 5.40% | $100k | 2022 | India | $25 | 21,000 |
| 2 | Meow | 23 | 5.00% | None | 2021 | NYC | $27 | 17,000 |
| 3 | Brex | 579 | 4.92% | 2017 | SF | $1,200 | 1,000,000 |
Source: FintechLabs, Crunchbase, SimilarWeb, 17 Jan 2023
*Meow rate updated 23 Jan 2024
FDIC-insured Deposits**
1. Meow
FAB Score: 23
– HQ: NYC
– Founded: 2021
– Banking service providers: FirstBank, Grasshopper Bank, Third Coast Bank
Rates (APY)
Top: 5.02% FDIC-insured deposits (updated 23 Jan 2o24)
Treasuries: 5.00%
Minimum Balance: none
Traction
– Raised: $27 million (Crunchbase)
– Employees: 27 (Pitchbook), unchanged
– Website visits: 17,000 (SimilarWeb, Nov 2023)
– Linkedin: 4,000 followers (232 employees, up 25 since Oct)
2. Mayfair
FAB Score = 17 (down 1 since October)
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: 18,000 (Nov 2023, SimilarWeb)
Articles: 1 (Crunchbase)
Linkedin: 730 followers (120 employees, up 11 since Oct)
3. Baselane
FAB Score: 33 (unchanged)
HQ: NYC
Founded: 2020
Rates (APY)
Top APY: 4.19%
Minimum Balance: none
Traction
– Raised: $7.9M in 2021 (Crunchbase)
– Website visits: 120,000 (SimilarWeb, Nov 2023)
– Employees: 31 (Pitchbook), up 2
Social
– Articles: 5 (Crunchbase)
– Linkedin: 2,000 followers (33 employees, up 4 since Oct)
4. Lili
FAB Score = 80 (up 4 since Oct)
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: 230,000 (SimilarWeb, Nov 2023)
– Employees: 105 (Pitchbook), unchanged
Social
– Articles: 18 (Crunchbase)
– Linkedin: 11,000 followers (231 employees, up 12 since Oct)
– TikTok: 235,000 followers; 600,000 likes
– Trustpilot: 4.7 (2,650 reviews, up 200)
5. LiveOak Bank
FAB Score = 55 (up 10 since October)
HQ: Wilmington, NC
Founded: 2008
Rates (APY)
Top: 4.0%
Minimum Balance: none
Traction
Raised: $152 million (Crunchbase)
Revenue (TTM): $427M (Yahoo)
Valuation: $1.6B (Public; 11 Dec 2023)
Website visits: 200,000 (Similarweb, Nov 2023)
Employees: 925 (Pitchbook), up 39 since October
Social
Articles: 3 (Crunchbase)
Linkedin: 18,000 followers (925 employees, unchanged since Oct)
Trustpilot: 4.5 (444 reviews, up 184)
6. Relay
FAB Score: 143 (up 54 since October)
– 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 $19.4M including $15M in 2021 (Crunchbase)
– Website visits: 660,000 (SimilarWeb, Nov 2023)
– Employees: 142 (Pitchbook), up 14 since October
Social
– Linkedin: 6,000 followers (147 employees, up 21 since October)
– TrustPilot: 4.6 (1,270 reviews, up 140)
– iOS: 4.7 (698 reviews, up 120)
7. Grasshopper Bank
FAB Score = 45 (down 1 since October)
HQ: NYC
Founded: 2016
Rates (APY)
Top: 2.25%
Minimum Balance: $25k
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: 53,000 (SimilarWeb, Nov 2023)
– Employees: 101 (Pitchbook), unchanged
Social
– Articles: 23 (Crunchbase)
– Linkedin: 19,000 followers (119 employees, up 10 since Oct)
– Trustpilot: 3.6 (76 reviews, up 11)
U.S. Treasuries and Other Securities
1. Mercury Technologies
FAB Score = 447 (unchanged since August 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)
Rates (Yield)
Top: 5.47% (not US Treasuries)
Minimum Balance: $250k
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 (Nov 2023; SimilarWeb) <<<< Most website traffic
– Employees: 681 (Pitchbook), up 12 since October
Social
– Articles: 20 (Crunchbase)
– Linkedin: 30,000 followers (710 employees, up 36 since Oct 2023)
– iOS app: 4.9 (3,100 reviews, up 400)
– Trustpilot: 3.8 (722 reviews, up 85)
2. Zamp
FAB Score = 24 (up 1 since October)
Founded: 2022
HQ: India
Rates (Yield)
Top: 5.4%
Minimum Balance: $100k
Traction
Funding: $25M (Crunchbase)
Employees: 28 employees (Linkedin)
Website traffic: 21,000 (Nov 2023, SimilarWeb)
LinkedIn: 5,000 followers (38 employees, up 2 since Oct)
1. Meow
FAB Score: 23
– HQ: NYC
– Founded: 2021
– Banking service providers: FirstBank, Grasshopper Bank, Third Coast Bank
Rates (APY)
Top: 5.02% FDIC-insured deposits (updated 23 Jan 2o24)
Treasuries: 5.00%
Minimum Balance: none
Traction
– Raised: $27 million (Crunchbase)
– Employees: 27 (Pitchbook), unchanged
– Website visits: 17,000 (SimilarWeb, Nov 2023)
– Linkedin: 4,000 followers (232 employees, up 25 since Oct)
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.
