In the United States, there is a rising wave of fintech startups aiming to solve immigrants’ problems by offering them services they are often denied by traditional banks. Being new to this country often means being excluded from its financial system because a personal credit history does not always cross the border with its owner. It’s a large problem for new arrivals because without credit history, one can’t obtain access to regular tools provided by the established financial institutions, like credit cards or even a simple transaction account.

Being an entrepreneur, I see this as an opportunity to create a product that can help over 40 million Americans access affordable financial assets and build a solid credit score. There are more than 250 neobanks all around the world that are already disrupting the huge banking industry that has 4,377 banks in the United States alone. In my view, it seems that these breakthrough companies will soon take the place of what today is occupied by traditional banks.

I am the cofounder of the fintech startup B9, which lets immigrants and other underbanked customers obtain a bank account without the credit score check. We are not alone — there are other startups that identify immigrants as their target audience. For example, the neobank Majority has been operating in the field since 2019, initially focusing on the Nigerian and Cuban communities in Texas and Florida. Sable is another digital banking solution with a “mission to bank the world,” as they put it. The mobile banking platform Oxygen caters to freelance creators and entrepreneurs, such as those who arrive with an O-1 visa. Zolve is a cross-border fintech company with Indian roots that helps “global citizens” to obtain a U.S. bank account. There are more, and there will be even more; the competition is high.

Financial Capabilities
For a long time, the United States has been marketed as a country where people can make their dreams come true through hard work and persistence. Whether someone’s dream is to start a company that will change the world, get access to high-quality education and research facilities, or grant a decent future to one’s family, for centuries people have been coming from all over the globe to build their own destiny.
The U.S. and its people benefit from immigration: Immigrants boost the economy and society by bringing their skills, knowledge and capability in a great variety of realms, from tech and healthcare to beauty services and retail. They earn money and pay taxes and bills. According to one report, the spending power of the immigrants in the United States equals $1.3 trillion.
Immigrants have the assets, but due to lack of credit score, language barriers and gaps in understanding the U.S. financial system, they stay underserved by traditional banks. At the same time, according to the Pew Research Center, there are more immigrants in America than in any other country — meaning there is already a vast market full of creditworthy customers who need financial products that meet their needs and wants. And this segment is only going to grow.
There is also the concern that the American population is aging while the fertility rate is low. Over time there will be far fewer people who pay into social security and many more who will instead collect these benefits — this is where creating financial solutions for immigrants comes in. In fact, financial inclusion for immigrants could help with the well-being of the nation in the foreseeable future.

The Gig Economy
The fast growth of the gig economy is another factor making immigrants high-potential customers for fintech companies. The gig economy refers to the carrying out of short-term tasks and providing payment for each task. This could include taxi services, food delivery, products of craft, guided tours for travelers, business consulting, short-term design projects and more. In the gig economy, providers and consumers are often connected through apps or platforms.
Many gig workers are immigrants, and the more the gig economy grows, the more opportunities they have to earn income. Being totally free agents or chasing an extra buck as casual earners, they need financial services just like any other Americans. Mastercard and Kaiser Associates forecasted in 2019 that the size of global gig economy transactions will grow by 17% and reach $455 billion by 2023 (in 2018 it reached $204 billion). As a result, the demand for fintech solutions will likely increase.

Fintech Opportunities
Though the rivalry on the market has already heated up, there is still space for new players. But it is not an easy game because there are a lot of nuances in creating banking products for those who have made America their new home. There is already a problem with financial literacy in the U.S., and for immigrants, understanding the necessary basics of the American economic system can be a much more complicated task than for those who were born here. Lack of language proficiency can contribute to the challenge, making it important for fintech startups to think through the strategies of adapting their products to multicultural and multilingual audiences.
At the same time, immigrants are not a monolithic unity, and tech companies should put a lot of effort into deeper research to better identify their customers’ needs. This may lead to a more segmented market, and it could be a chance for small startup teams to develop unilateral solutions that are later acquired by bigger companies. Besides, I think it is very likely that traditional banks will be more intensively looking for partnerships with fintech providers in order to keep up with the inevitable rise of standards for financial products.
There is a common misperception of immigrants as non-compliant individuals who live in the U.S. illegally, but many immigrants are legal, decent workers and good earners, which makes them highly attractive customers for fintech companies. The market for financial products for immigrants is growing by leaps and bounds right now, but it still has a lot of prospects ahead.