Live · Qatar Now
Chime shares surged 10 per cent before the bell on Wednesday after the fintech firm agreed to buy Stride for $590 million, gaining a bank charter that would allow it to expand its lending business. Over the past few years, Chime has emerged as a major challenger to traditional banking heavyweights, offering app-based, low-cost financial services. The Stride Bank deal, announced late on Tuesday, would give Chime more control over operations as it forays into products and services dominated by traditional lenders.
Wall Street analysts praised the deal, with Piper Sandler stating it would improve Chime’s unit economics and greater control over product development. William Blair analysts noted this as a bold move with potential to accelerate Chime’s market share. A growing number of fintechs, neobanks, and digital-asset firms are seeking bank charters to expand their role in the financial system.
Stride, a nationally chartered bank, has been Chime’s partner for over seven years. Chime raised its third-quarter and full-year forecasts for revenue and core profit growth. Analysts see the threshold of $10 billion in assets as key, keeping Chime Durbin-exempt from debit-card fee caps.
The acquisition is expected to generate over $100 million in net synergies, driven by lower sponsor bank fees, expanded lending products, and a lower cost of funds. The deal is expected to close in the first half of 2027 and is expected to support faster product innovation, increased member trust, a structural cost advantage, and greater control. Wolfe Research analysts wrote that the acquisition would support these benefits.
Source: BNN Bloomberg
