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Varo layoffs are a sign of neobanks’ struggle to break even

““Most American neobanks cater to lower-income customers, who previously may have incurred overdraft, [non-sufficient fund fees] and maintenance fees at big establishment banks,” Mikula told Protocol. “But these consumers also tend to be higher credit risk, making it challenging to lend to them. No U.S. neobank has built a meaningful lending business.””

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