Online lender BlueVine is adding a checking account to its suite of products.
The Redwood City, California-based fintech said the new service, which includes a 1% yield on balances over $1,000, will target small businesses.
BlueVine plans to launch the Federal Deposit Insurance Corp.-insured checking account in early 2020 through a partnership with The Bancorp Bank.
The company already offers a business line of credit, invoice factoring and a term loan — all of which are provided online.
BlueVine CEO Eyal Lifshitz said the checking account expands the platform to offer "true end-to-end banking" for small businesses.
"In our minds, credit is part of broader banking," Lifshitz told Banking Dive. "And now with the ability to offer checking accounts to them, then we can answer more of their needs and create a more seamless experience."
The new service includes unlimited transactions with no monthly fees and the ability to withdraw cash at more than 38,000 ATM MoneyPass locations with a debit Mastercard. Customers can also deposit checks through BlueVine's mobile app.
"The typical small business owner pays over $480 a year for their business checking account services," Lifshitz said. "We are giving that for free, because we don't believe that small businesses should pay money for standard services."
Lifshitz said the service will only charge for wire transfer fees, adding that BlueVine is able to pull off the largely fee-free model because it's meeting a need that traditional banks are failing to serve.
"[Banks] don't lend to small businesses nearly as much as there is demand," he said. "They're not able to assess that risk in a standardized, scalable way. And it's expensive for them. … And that's why they resort to nickel-and-diming them."
BlueVine said it has originated about $2.5 billion to more than 20,000 small businesses since 2013.
The company will continue to make money off the credit it earns from its lending service, while its digital model will continue to keep costs low, Lifshitz said.
"Our goal here is to democratize commercial banking for small businesses, and really deliver commercial-grade banking for them in a simplified way," he said. "No one that we know is building or has built a bank designed and built specifically for small businesses. And that is what we're doing."