What’s happening in challenger banking, June 2021
- Tearsheet publishes Challengers, its bi-weekly newsletter on what's happening in digital banking.
- Here are the the ins and outs of how digital is impacting the business of banking as of June 2021.

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Challenger banks continue to be knee deep in the niching game. And freelancers and small-business owners may turn out to be a promising segment to zero-in on. -- Rivka Abramson
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Freelancers and small businesses are emerging as a prominent niche to focus on for challenger banks
Covid-19 has left people jobless, but it’s also left them with more time to pursue other goals, including starting their own businesses.
- Small businesses builders today make up 85% of the US economy.
- Freelancers are getting more space in the job market, with 90% of companies surveyed saying they wouldn’t mind a few more freelancers on board.
Lili is a challenger bank that’s zeroing in on this trend. The company recently passed the 20,000 user mark, and raised $55 million in its Series B funding. It also reported it’s grown by 1,500% in one year.
- The challenger bank provides an account to its users that doubles as both personal and business.
- The account includes features that do things like automatically put away money for taxes and categorize expenses.
- The next things the challenger bank wants to tackle include invoicing and credit evaluations.Lili aims to serve women most of all. 60% of the challenger bank’s new users are women.
What we're reading
After raising $20 million in just 40 days earlier this year, Fair, a challenger bank for immigrants, officially launches (TechCrunch)
Challengers and fintechs give established providers a wake-up call (The Financial Brand)
Gen Z and millennials want generosity from their financial service providers -- challenger banks are zeroing in on that (American Banker)
If they really want to stick around, incumbent and challenger banks may have to stick together (altfi)
SMB focused challenger bank NorthOne partners with Bancorp and Galileo (PYMNTS)
Artificial intelligence and machine learning are proving to be the safest way to prevent financial fraud. Challenger banks are using these tools to improve their onboarding process (PYMNTS)
German financial regulator BaFin orders N26 to fix money laundering controls (Banking Dive)