Credit Karma, the company that turned the promise of a free credit score into a business worth over $7 billion, is joining the ranks of “neobank” startups offering a checking account. The product will be folded into Credit Karma Money, which launched last year as a savings account available to the company’s 100 million members. Digital banking has been gaining steam for the last several years, with the pandemic only accelerating consumers’ interest in the options that neobanks are providing. In the U.S. and Europe, there are now over two dozen neobanks, which have collectively raised over $6 billion in venture funding. “We think this is a product for people who have been left behind in financial services,” Credit Karma cofounder and CEO Kenneth Lin says of his company’s variation on the theme. Credit Karma Money Checking will not charge fees and will include automated features designed to help users better manage their money, such as bill payment date optimization. Over time, data from Checking will also help the company better present its members with targeted advertisements for loans, credit cards, and more. “Historically, Credit Karma has been focused on helping people optimize their credit, optimize their borrowing,” says Lin. “Now we’re moving to the other side of that spectrum. We want to help you save for your future, and this is the connector to making all of the pieces work.” [Image: courtesy of Credit Karma] Credit Karma is entering an increasingly crowded market for digital-first checking and savings accounts.
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With its new checking account, Credit Karma wants to get into your wallet