Chime Buys Its Bank: $590 Million Deal Ends Years of Partnership, Lifts Outlook

Chime Financial just purchased the house it had been renting for more than seven years. The mobile banking provider announced Tuesday it will pay $590 million in cash for Stride Bank. The Oklahoma-based institution will become Chime Bank. A wholly owned subsidiary.

The move caps a long relationship. Stride has held deposits and issued debit cards for Chime customers since the early days of the fintech’s rapid growth. Now control shifts entirely in-house. No more sponsor bank fees on a big chunk of the business. No more split attention between partners.

Control at Last

Chime will consolidate its banking activities at the new subsidiary. It plans to keep assets below $10 billion for the foreseeable future. That threshold matters. Banks under that size escape the Durbin Amendment’s cap on debit interchange fees. Higher revenue per swipe stays intact.

The price equals roughly 1.5 times Stride’s tangible book value. The target is profitable and well capitalized. Chime expects more than $100 million in net annual synergies. Those gains come from eliminated sponsor fees, expanded lending, and a lower cost of funds. The deal should boost earnings per share right away.

Chris Britt, CEO and co-founder, framed the acquisition in familiar terms. “We founded Chime because mainstream America deserved better banking,” he said in the company’s official announcement. “Our member-aligned, technology-driven strategy will remain the same. This acquisition will make our proven model even stronger.”

The statement carries weight. Chime has built a user base exceeding 10 million active members by offering fee-free checking, early direct deposit, and overdraft protection without traditional penalties. Revenue comes mainly from interchange and other payments income rather than interest or fees charged to customers.

But the partner-bank model always carried limits. Chime split activity between Stride and The Bancorp Bank. Random allocation of new accounts created operational complexity. Regulatory scrutiny of such arrangements has grown across the industry. Owning one sponsor outright simplifies things. Yet Chime signaled it will maintain relationships with both banks post-deal. Deposits and activity will be managed carefully to stay under the asset cap.

Stride, founded in 1913 in Enid, Oklahoma, brings a national charter and existing infrastructure. The bank reported about $4.9 billion in assets and a 26% return on equity in recent figures shared by analysts. Integration should prove smoother than starting a bank from scratch. Chime explicitly called the purchase “a faster and more proven path to full-stack ownership versus pursuing a de novo bank charter,” according to a Reuters report.

Regulators must still approve the transaction. The Office of the Comptroller of the Currency and the Federal Reserve will review. Closing is expected in the first half of 2027. Chime will become a bank holding company. Federal Reserve supervision will extend to the parent. The company said it will fund the purchase from existing cash. No new capital raise is planned.

Investors liked the news. Chime shares jumped nearly 10% in extended trading Tuesday. The stock has risen more than 28% so far this year. The reaction reflects relief that the long-speculated move finally arrived. It also reflects confidence in the financial math.

Alongside the deal, Chime raised its 2026 guidance. Third-quarter revenue is now seen at $705 million, up from a prior range of $680 million to $690 million. Full-year revenue should hit $2.76 billion to $2.77 billion. That implies 26% to 27% growth. Adjusted EBITDA margins are projected between 17% and 18%. The updated outlook follows strong second-quarter results that already topped previous forecasts.

The timing feels deliberate. Chime went public last year at a valuation well below its 2021 private peak. Public market discipline has sharpened focus on profitability and efficiency. Buying the partner eliminates a recurring expense. It opens new lending opportunities under direct control. And it positions the company as more than a fintech layer on top of traditional banks.

Yet risks remain. Integration of a century-old community bank with a Silicon Valley technology operation won’t happen overnight. Regulatory approval could bring conditions. Keeping assets below $10 billion requires discipline as the user base grows. Chime must continue selling deposits or loans to partners to stay under the line. The Bancorp relationship stays relevant.

Analysts have noted the deal’s immediate accretive nature. Morgan Stanley advised Chime on the transaction. Piper Sandler advised Stride. The all-cash structure avoids dilution. Synergies of $100 million-plus represent a meaningful lift to projected profitability.

For years Chime told a story of alignment with everyday consumers. No overdraft fees. Early paycheck access. Credit Builder products that function more like debit. The model resonated. It attracted younger users who felt ignored by big banks. Now the company takes the next logical step. Ownership of the underlying bank charter.

But. This doesn’t turn Chime into a traditional lender overnight. Its strength remains payments and user experience. The bank subsidiary adds foundational capabilities. It doesn’t replace the technology-driven culture that fueled growth.

Recent coverage highlights the strategic shift. Bloomberg reported the deal streamlines operations and ends reliance on multiple partners for core functions. Crypto Briefing noted the vertical integration bet could unlock sustained cost advantages. Industry observers on X described it as an “uno reverse” – the fintech that built atop the bank now owns it outright.

Chime’s path hasn’t been without bumps. Past regulatory settlements over marketing language. Workforce reductions tied to AI efficiencies earlier this year. Exploration of stablecoins and other forward-looking features. The Stride acquisition fits a pattern of measured evolution rather than radical change.

Success will depend on execution. Can the company maintain its nimble product development while absorbing bank operations? Will lending expansion deliver without introducing credit risk that changes the business model? How will the market value a payments-focused company that also owns a regulated bank?

Answers will emerge over the next 12 to 18 months. For now, Chime has taken a decisive step. From challenger to owner. From partner-dependent to vertically integrated. The $590 million check writes a new chapter. One where the technology company holds the charter it long relied upon.

And the broader industry watches. Other fintechs with sponsor bank arrangements may reconsider their structures. The appeal of full control grows when the numbers work. When synergies exceed the purchase price multiple. When guidance rises on announcement day.

Chime didn’t invent the neobank model. It perfected aspects of it for a specific demographic. Millions of Americans now use its app as their primary financial account. The Stride deal aims to secure that foundation for the long term. Lower costs. Greater flexibility. Direct oversight of critical infrastructure.

Whether that translates into market leadership remains to be seen. The vision, as Britt stated, is to become the largest provider of primary bank accounts in America. Owning the bank removes one barrier. Many others – competition, regulation, consumer trust – still loom. But the company enters this next phase with momentum, raised forecasts, and a clearer operational path.