2020-02-01 Forbes Asia

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FEBRUARY 20 20 FORBES ASIA

But then Wilk decided to turn Dave into a neobank. In

June, using Synapse, Dave rolled out its own checking ac-

count and debit card. Now it can make money on “inter-

change,” the 1% to 2% fees that retailers get charged when-

ever a debit card gets swiped. These fees are split between

banks and debit-card issuers like Dave. Wilk optimistically

predicts Dave will bring in $100 million in revenue this year

from its 4.5 million users—up from $19 million in 2018, the

year before it transformed itself into a neobank. Dave was

recently valued at $1 billion.

Established fintech companies that didn’t start out in

banking are getting into the game too. New York-based

Betterment, which manages $18 billion in customers’ stock

and bond investments using computer algorithms, recently

rolled out a high-yield savings account. It pulled in $1 bil-

lion in deposits in two weeks. “The success has been un-

precedented. In our history we’ve never grown this fast,”

marvels Betterment CEO and cofounder Jon Stein. Now

he’s launching a no-fee checking account with a debit card,

and credit cards and mortgages might be next, he says.

Neobanks are swiftly emerging as a huge threat to tradi-

tional banks. McKinsey estimates that by 2025 up to 40%

of banks’ collective revenue could be at risk from new digi-

tal competition. “I don’t believe there’s going to be a Netflix

moment—where Netflix basically leapfrogs Blockbuster—

where fintechs basically put the banks out of business,” says

Nigel Morris, a managing partner at QED Investors, an

Alexandria, Virginia-based VC firm specializing in fintech.

D   

iwakar (Dee) Choubey came to the U.S. at

4 when his father was finishing a graduate

degree in engineering at Syracuse Univer-

sity. When Choubey entered the Universi-

ty of Chicago in 1999, he started in com-

puter science and then switched to economics. After gradu-

ating with honors, he went into investment banking, where

he remained for the next decade.

From an insider’s vantage point, he saw that traditional

banks were slow to respond to the preferences of their cus-

tomers and exploit the power of smartphones. That, plus a

never-ending series of bank scandals, convinced him that

there was an opening for a digital private banker. In 2013

he walked away from his near-seven-figure salary to start

MoneyLion.

Betterment cofounder Jon Stein at his New York City startup. It took a decade to get 420,000 clients for its robo-advisor business managing stocks and

bonds; as a neobank newcomer, Betterment already has 120,000 on a waiting list for a checking account.

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