Is Chime IPO next? All you need to know

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Is Chime IPO next? All you need to know

 Is Chime IPO next? All you need to know
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Highlights

  • In August 2021, Chime was worth US$25 billion after a US$750 million fundraising round.

  • Chime’s revenue is expected to hit US$900 million to US$1 billion this year.

  • Chime became popular because of its zero-fee for FDIC-insured checking and savings accounts, particularly among lower and middle-income Americans.

The San-Francisco-based fintech company Chime is another major business planning to go public. It is reportedly in talks to float an IPO at a valuation of around US$35 billion.

At this estimate, Chime would be more valuable than some regional banks like Fifth Third, which has hundreds of branches in the US.

According to people familiar with the matter, it might happen early next year, although the company has not officially announced the date.

However, the interest has been growing for its imminent flotation.

Chime’s revenue is expected to hit US$900 million to US$1 billion this year, the source told a media outlet requesting anonymity.

How to buy Chime shares

Investors will be able to buy its shares like any other publicly-traded company on the stock market. In August 2021, the company was worth about US$25 billion after a US$750 million fundraising round.

Before that, in September 2020, it raised US$200 million in a Series F funding round. At the time, it was valued at around US$14.5 billion.

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 Is Chime IPO next? All you need to know

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What is Chime?

Chime, founded in 2013, became popular because of its zero-fee for FDIC-insured checking and savings accounts, particularly among lower and middle-income Americans.

It offers small loans of up to US$200 to customers and fee-free mobile banking services. It doesn’t have a license but provides the services in alliance with Bancorp and Stride Bank.

Chime’s rivals include the UK-based Revolut, Germany’s N26, and Brazil’s Nubank.

In the US market, Varo, which gained approval in 2020 from the Federal Deposit Insurance Corporation for banking services, could be a major rival to Chime in future.

Chime earns revenue from transaction fees when people use its debit card. Its major investors include co-founder and CEO Chris Britt, Sequoia Capital, and Softbank.

Bottomline

The US fintech sector has seen robust growth in 2021. According to an industry estimate, the US fintech startups raised around US$43 billion in funding this year. Also, around 46 fintech companies have gone public in 2021, compared to 31 a year ago.

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