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Pride Month: banking the unbanked

Pride Month is in full swing and there's an opportunity to explore how the LGBTQ+ community banks, or - unfortunately - how they're shut out from banking. Queer banking customers can lack financial services due to prejudice related to their sexual and gender identity. These challenges can include acquiring loans for starting a family, changing banking documents for transgender customers, or support for gender transitioning. The silver-lining though is there are challenger banks hoping to change this.

Daylight launched less than 2 years ago as the first digital banking platform in the US specifically working with LGBTQ+ clients, and others have popped up like the Brazilian equitable-focused challenger bank,  PrideBank.

Focusing on underserved customer segments is a growing trend in the increasingly competitive digital banking space. Challenger banks are in fact still the most funded segment in fintech with $2.7B, but funding is slowing down significantly from last year's height of $11.7B.

With such strong competition, targeting is a way to get a strong foothold in an obtainable market and expand from there to a wider market.  Startups can cater to the specific needs of a community (like the LGBTQ+), sell to a more focused market, and create a strong network effect.

There are many challenger banks, like Daylight and PrideBank, that are working to provide banking to underrepresented communities outside of the LGBTQ+ as well that include mobile platforms for Black and Latinx business owners (Greenwood), and zero fee debit cards with credit perks for the Asian communityAsian community in the US (Cheese).

On Dealroom, we've mapped 250+ challenger banks across the world banking the unbanked and providing better digital-first banking experiences.  Explore today by clicking the button below. 👇 

In other news

💳 Apple to offer buy now, pay later credit in challenge to Klarna and Affirm - BNPLs is now facing significant challenges with slowing consumer spending and increasing competition with Apple entering the space - Financial Times

🔎 Citigroup Plans to Hire 4,000 Tech Staff to Tap Into ‘Digital Explosion’ - While layoffs run widely in the fintech industry, some traditional financial sector companies are seizing the moment. - Bloomberg

Latest fintech deals

The largest this week:

🇩🇪 Trade Republic raised another €250M in Series C extension at a €5B valuation. 

Trade Republic's strength lies in ETF-based or fractional stock savings plan, allowing individuals to invest free of charge over time and on a regular basis.  Like many other neobrokers, Trade Republic is also expanding into crypto.

Explore  80+ retail stock trading platforms.

🇮🇳 Slice, a fintech startup that is bringing credit card features to millions of Indians, has raised a $50M round led by Tiger Global at a $1.7B valuation. Slice is going to scale its recently launched UPI payments product and push to make its core credit business profitable.

🇺🇸 Utopia Labs, a payroll and expense management system for DAOs raised a $23M Series A funding round led by Paradigm with continued support from its earliest seed investor, Kindred Ventures. Utopia Labs integrate directly with multisig crypto wallets and is now working with more than 100 DAOs, up from roughly 30 earlier this year.

Other notable fintech deals from around the globe:

🇫🇷 Paris-based pet insurance startup Dalma has raised a €15M Series A, as pet insurance continues to grow in Europe. Dalma will aggregate new services beyond insurance: unlimited video calls, direct payment to vets and an e-commerce section selling pet goods. 

🇳🇬 Nigeria's credit infrastructure startup Indicina raised a $3M Seed round to build Africa's credit bureau system. Lenders can use Indicina for credit scoring and bank sentiment analysis, getting access to ML-driven financial analytics and improved insights into consumers they currently don’t have and derisk unsecured loans.

🇨🇭 Numarics raised a CHF2.1M pre-seed financing round led by Wingman Ventures. Numarics combines artificial intelligence with expert knowledge from the fields of fiduciary services, audit and digitalization which gives SMEs access to state-of-the-art finance management.

Read up on all the latest fintech deals in Dealroom.co

Tip of the week

🦄 Unicorn tracking by country:

Unicorn creation has strongly slowed down going back to pre-pandemic levels. 
You can track new unicorns by country using Dealroom investment heatmaps.

Explore unicorns by country. 👈

Job opportunities

🇺🇸 Daylight, a challenger bank for the LGBT+ community, is hiring for a marketing specialist and other 4 roles.

🇬🇧 Passport, a RegTech that automates anti-financial crime & compliance processes, is hiring for a Customer Sucess Manager and other 16 roles.

 🇳🇱 At Dealroom.co we are hiring a Sr. AI Engineering and 11 other roles.

Discover 67,000+ job openings at fintech startups (login for full results)

Dive in

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Lorenzo Chiavarini

Innovation Analyst
Dealroom

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