Online lending platform Avant applied for a de novo bank charter Friday, joining a parade of fintechs in pursuit of deposit insurance and full banking capabilities.
The Chicago-based fintech, which launched in 2013, offers credit cards and unsecured loans to serve middle-income Americans that Avant’s co-founder and CEO, Al Goldstein, called “overlooked by the legacy system.”
“We’ve spent more than thirteen years developing a data-driven approach to credit that serves this population at scale,” Goldstein said in a press release. “A national bank charter would further our mission, help reduce our cost of funds, and enable us to offer products under one regulatory framework.”
A charter from the Office of the Comptroller of the Currency would allow Avant to expand its credit products and diversify beyond them, as well as reduce its cost of funds, Goldstein said in a prepared Q&A shared with media.
“If approved, a bank charter would enable Avant Bank to operate under one regulatory framework, which supports more consistent access to Avant products no matter where a customer lives in the United States,” Goldstein said. “Moreover, it would enable a simplified operating model which helps us to continue to improve the customer experience as we seek to become the core financial partner for middle-income Americans.”
Roughly one-third of U.S. adults applied for credit last year, and one-third of those were denied or approved for less credit than they requested, according to the Federal Reserve. Avant determines customer creditworthiness through proprietary machine learning tool CreditOS, which uses data beyond what’s considered by the credit bureaus.
Michele Alt, who co-founded financial services advisory and investing firm Klaros Group, called Avant’s filing “an important milestone in [the company’s] mission to expand credit access for everyday Americans.” Klaros consulted with Avant on the application.
“Avant has already facilitated over $17 [billion] in credit to those who are overlooked by the legacy financial system,” Alt told Banking Dive. “The bank will build on Avant’s successful model to give these consumers access to affordable credit products and financial tools designed to help them move their financial lives forward.”
Avant joins 42 other firms in applying for OCC de novo charters since January 2025, the regulator said. The OCC has approved 27 of these charters, denied two and returned one. The rest are under consideration. While 12 de novo applications have come in for national trust charters, 15 – including Mercury’s and Nubank’s – have been for full bank charters.
“Our goal has always been to offer our customers the most attractive financial solutions. A bank charter would help us to expand our products to more customers and help make those products more competitive,” Goldstein said. “Reducing operational overhead and the cost of facilitating access to credit creates opportunities to pass those savings on to consumers and to reach segments of the population that the economics didn't previously support.”
