Daylight is the first LGBTQ digital bank in the U.S.
The new challenger bank provides its LGBTQ customers with benefits like Visa-branded cards in their preferred name (and not necessarily their legal name), a network of finance coaches, unique personalized feeds on financial advice, tools to monitor and improve spending habits, along with a space for donations to LGBTQ charities.
Daylight, which was known as Be Money before it took on customers, will offer consumers benefits such as money management on LGBTQ specific life events such as gender transitioning, having children and retirement.
The launch and rebranding comes at a time when the worldwide pandemic has severely strained the financial health of LGBTQ people in the U.S. Poverty, unemployment and discrimination underscore some of the harsh realities facing LGBTQ Americans since the beginning of the pandemic.
Human Rights Campaign’s recent research brief found that 20 percent of LGBTQ people in the U.S. believe that their personal finances are worse off than they were in the previous year. 62 percent of LGBTQ Americans reported facing financial challenges as a consequence of their gender identity or sexual orientation, according to Experian’s 2018 LGBTQ Money Survey. The community on average carries higher debt and less insurance.
Although there are an estimated 30 million LGBTQ Americans with $1 trillion in spending power, the community still feels underserved within the incumbent financial industry.
“LGBTQ people still face systemic discrimination from incumbent and challenger banks alike, including lower mortgage approval rates, higher fees or risk assessments, impersonal and insensitive services,” said Daylight’s CEO Rob Curtis. “For example, when addressing a gay man ‘sir, what does your wife do?’ or misgendering a trans person. The financial system has had a long time -- and an incumbent advantage -- to address these issues and has failed. We are taking matters into our own hands.”
Many traditional banking services pigeonhole transgender and non-binary consumers into 'deadnaming' themselves by having them verify themselves through their birth names. This poses considerable security and mental health risks. Daylight customers can choose a name for their debit card that they’re comfortable identifying as, making it easier to authenticate when they make a transaction.
“Traditional banks need to go further by addressing the systemic issues faced by the community, offering real and meaningful support for the 20 percent of LGBTQ people who are unbanked or underbanked,” said Daylight’s Co-founder Billie Simmons, “Daylight is different. Rather than address the symptoms of the problem, we are looking at the root cause. For example, we aim to redefine the traditional Know Your Customer process so that trans people with mixed forms of identity are not subjected to higher rates of false positives for identity theft and subjected to longer SLAs for account opening and approvals.”
Visa and Marqeta partnered to launch Daylight, which will soon grant public access to its services. “We’ve heard from over 1000 LGBTQ people and many in our community feel in the dark about their finances. We believe Daylight reflects our commitment to shining a light on LGBTQ money and being positive, affirming champions for members of the community to reach their goals, whatever they may be,” said Simmons.
Daylight is part of the Fast Track Program, Visa’s accelerator that offers fintechs tools and guidance to quickly get up and running on the Visa payment rails through its large global network and digital payment solutions. The program has around 140 international fintechs, like Australian based Airwallex and Columbian multivertical company Rappi.
“Fintechs play a critical role in bridging financial gaps and expanding access of financial services to diverse communities around the world,” said Terry Angelos, senior vice president and global head of fintech at Visa. “By partnering with companies like Daylight, we are working to create a more inclusive and accessible financial ecosystem, and will remain committed to creating offerings for those who have long been underrepresented in this sector.”
This isn’t the first time Visa has collaborated on a project to address the LGBTQ community. The company has partnered with Out and Equal, an organization that works towards workplace equality. Visa has also committed to the Human Rights Campaign’s Business Coalition for Equality Act, which is aimed towards workplace protection from harassment and discrimination.