Former PayPal boss Harris raises $17m for middle-class digital banking startup One
One, a digital banking startup founded by former PayPal and Intuit CEO Bill Harris, is launching in private beta after closing a $17 million Series A funding round.
Foundation Capital, Core Innovation Capital, and Obvious Ventures participated in the round for One, which Harris set up last year with former Azlo CEO and Capital One SVP Brian Hamilton.
Entering a busy field of American digital banking startups, One is now available in private beta ahead of a planned summer launch when it says it will target an underserved market segment: middle class Americans.
“There’s a gap in the market that’s not being met. Traditional banks cater mostly to affluent customers and new digital banks target younger individuals with simpler financial needs,” says Harris.
“Middle-class American families are being left out, and we built One specifically for them. One will combine the technology and convenience of challenger banks with a full-suite of products that traditional banks offer.”
Central to this is One’s efforts to put credit at the heart of its service, helping customers to integrate their finances into one account, making it seamless to save, spend and borrow money.
The firm is promising competitive interest rates for savers, while debit and credit are wrapped into one account with one card. Customers will also be able to get an integrated line of credit and tools to make it easy to share money an expenses.
Says Hamilton: “The current financial system breaks up the money people earn into silos, making it hard for busy families to stay on top of their banking and credit accounts. Most people have a balance in their checking account that earns nothing and outstanding debt on their credit card that costs too much.
“One is designed to maximize a family’s hard-earned paycheck by unifying saving, spending and borrowing into one account. When this money is being managed from one place, people save more, are charged less and gain control.”
Separately, another US digital bank, called Cogni, is gearing up to launch this month.
A graduate of the Barclays TechStars Fintech Accelerator with $6.6 million in funding behind it, Cogni is targeting millennials and Gen Z, pitching a service that connects their banking with their lifestyle, evolving as their needs change.
Customers will get a no-fee account, with no account minimums, free cash withdrawal, free P2P transactions, virtual and physical debit cards and the ability to create single use cards.
Archie Ravishankar, CEO, Cogni, says: “Ultimately, we want Cogni to be the operating system for lifestyle and we see banking as the first step in this journey. Lifestyles are changing and consumers want a better digital experience.”