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As Fintech startups continue to grow, they’re looking for ways to expand their business and integrate themselves further into their customers’ lives. Increasingly, they’re doing that by offering a debit card to their users.

Three high-profile startups—Acorns, Venmo, and SoFi—have recently launched debit cards, which all come with user-friendly apps made to manage them. Their motivation for doing so varies slightly, but in all three cases, the new offering represents just one more way that these startups are encroaching on the business of traditional banks and credit unions.

Acorns
Acorns spent a lot of time and energy on the design of its debit card, creating an eye-catching neon green card made with tungsten metal. The company has tried to create some buzz around the card launch, announcing that the initial shipment of cards (going out in November) would only go to the first 100,000 users to sign up.

The debit card represents the next step for the micro-investing robo-advisor, which began by helping users save by rounding up the dollar amount from everyday purchases and putting that “spare change” into an investment account. Now, the startup wants to collect other deposits from customers as well. The new debit card is linked to an Acorns checking account, which gives the company a larger share of the customer’s wallet and the potential to become the customer’s primary account.

In addition to making Acorns a bigger part of consumers’ everyday lives, the new checking account and debit card also give Acorns access to a host of new data. Ultimately, the company will be able to track users’ spending habits and potentially make recommendations as to how they can invest and save more.

Venmo
While the Acorns debit card may be a move primarily to expand their brand offerings, the Venmo debit card may be more motivated by protecting the company’s market share in the peer-to-peer payments market. The rise of Zelle has given consumers less motivation to use Venmo, since Zelle offers an instant transfer directly to a bank account.

Venmo’s debit card solves that problem, making transferred funds instantly available via the company’s new debit card. Venmo also offers unique, on-brand features, such as the ability to track your debit card purchases and share money with Venmo friends.

SoFi
The debit card offering from SoFi appears to be a more straightforward brand extension as the company continues to mature from simply an online lender into a more broad-based financial services firm with which a consumer can do all of his or her banking transactions.

Its appeal may be based mostly on rates. SoFi does away with separate checking and savings accounts, instead offering a combined account with a current rate of 1 percent, far higher than what larger banks are offering.

All these examples illustrate how Fintech companies are starting to look and act more like traditional banks with checking accounts, debit cards, and bill payment features. While their appeal may remain limited for now, it’s more important than ever for banks to monitor these types of launches and think about how to modify their own products to compete.

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