Mobile banking app Current, which started as a teen debit card managed by parents has now extended to offer personal checking accounts earlier this year.
A New Round of Investors
The company states it has developed to host more than 500,000 accounts on its service and has settled on $20 million in Series B funding to promote its growth.
The round involved new investors like Wellington Management Company, Galaxy Digital EOS VC Fund and CMFG Ventures.
Venture capital arm of the CUNA Mutual Group, a mutual insurance company helping credit unions and their 120 million members, joined the group as well.
Recurring investors involved QED Investors, Expa and Elizabeth Street Ventures.
Till date, Current has allocated $45 million in funding.
The Story of Current
The initial version of Current, which debuted in 2017, was centred on providing parents with a more latest way to dole out allowances and pay their kids for chores.
But over time, the product matured more like a real bank account for teens, ending with the increase of routing and account numbers late last year.
This let working teens lead their paycheck to Current, as they could with a regular bank.
This year, Current started personal checking using the same hub technology powering its teen banking product.
The product adds features like securer direct deposits, gas hold crediting and merchant checking without imposing overdraft fees, hidden fees or requiring minimum balances.
While the teen checking account users have an average age of 15, the average age for the current personal checking account users is 27.
Although personal checking was only started in late January, it already had accounted for around half of Current’s accounts.
It also profits from conversions from Current’s teen users who become 18 and want to graduate to their banking app.
This puts Current in an added competitive market, where several banking apps are now aiming for a younger, more mobile generation that has started to support modern, feature-rich apps over brick-and-mortar banks.
Amongst its opponents are apps like Step, Cleo, N26, Chime, Simple, Stash and many others.
The company is projecting to launch more features starting next year, including a cash-back system with brands and dealers in Q1.
Moreover, further down the road, it is considering items like a credit product and possibly Bitcoin investing.
But this will need further education and thorough attention to do well.
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Image Courtesy: Current