We are banking built around community. Before there was Wall street and the too-big-to-fail banks, we had each other.
As a member of the our community, you get a FDIC-insured checking account with absolutely no fees, a debit card with access to more than 38,000 free ATMs and most importantly, the peace of mind of our community safety net.
Our community safety net is an in-built accident insurance policy that will provide upto $5000 directly in your betterbank account in case of an accident or medical emergency.
As freelancers living in NYC, we realize that the biggest challenge to our finances is a one-off shock--a medical emergency that leaves us with unpaid medical bills and unable to work for a while. This is true for the majority of Americans.
The safety net protects our members against such situations. It is not a replacement for health insurance--but rather something that goes on top of it and helps pay for out-of-pocket expenses that health insurance doesn’t cover such as deductibles, lost wages, rent etc.
We make money through “interchange fee”. Every time you use your Better Debit card, we get a small fee called “interchange” from the merchant. Part of that interchange fee goes to our community fund to help pay for the safety net while the rest of it helps keep our lights on.
While building betterbank, we came across multiple stories of people getting shortchanged by their banks. We realized that banks have no fiduciary duty to their members---which essentially means that If you walk into a bank today, your banker can give you advice that makes them money even if it hurts you. And you can’t hold them legally accountable for it.
Just look at the wells fargo scandal--millions of vulnerable americans paid for things they didn’t want or need because their bankers aggressively sold them them just to make a quick buck.
It is important for us to hold ourselves to the highest standards of behaviour, so we decided to incorporate as a public benefit corporation. This ensures that we are both legally and ethically responsible to you and put your interests first.
There are two parts to this question.
First off, for the banking bit---we work with a FDIC insured partner bank. All deposits in your betterbank account are insured upto $250,000 as per FDIC limits.
In terms of the technology, we have an edge over banks because we are a tech company. Most of banking is already powered by technology. In fact, If you walk into a bank branch today and talk to a teller, they will charge you a human teller fee.
We use APIs which are like lego bricks of code. We stack them together to build our banking infrastructure. This is something that wasn’t possible ten years ago. Banking was done by people who wear thousand dollar suits to work, but now people like us can use the power of technology to compete with the biggest financial institutions and beat them at their own game.
We are an app based bank built on software--our team can work on an update and push it out to millions of users in one go. While the big banks are like giant oil tankers, they take a lot of time to move and have a lot of legacy costs--- for eg. paying for annual bonuses and expensive box seats for their execs.
The more important answer is mentality--the big banks have grown fat over these years charging fees and ripping people off, it’s not that easy to kick off a bad habit. The era of big banks needs to end---they have held us hostage too many times and forced us to pay for their mistakes.
We are so excited to hear that you like what we are building. The best way to keep in touch is to sign up for the waitlist---we will send you updates, swag and fun ways to engage with the community. You can also email us at [email protected]
We’re excited that you love our mission to #buildabetterbank around the needs of everyday Americans.
Sign up to get early access.