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Inside Upstart's journey to get a bank charter approval

Upstart's move to secure a bank charter promises more stable funding and consistent credit access for merchants using their AI-driven lending platform.

Curated by Financing Your Way from original reporting by American Banker — Top News. Summary is AI-assisted and editorially reviewed — see our editorial standards.

FYWBy Financing Your Way EditorialJuly 24, 2026

Upstart is moving closer to becoming a full-fledged bank after receiving conditional approval for a de novo charter from the OCC. For retailers and merchants using Upstart’s financing tools, this marks a major shift from a fintech middleman to a regulated depository institution. This transition means Upstart will soon lend from its own balance sheet rather than relying solely on outside investors or partner banks to fund consumer loans. For your business, this likely translates to more stability and consistent lending capacity. Fintechs that rely on capital markets often tighten their lending criteria when the economy gets shaky or interest rates rise. By holding deposits, Upstart can offer more predictable financing options for your customers across various cycles. The move also signals that Upstart is willing to undergo intense regulatory scrutiny to prove its AI-driven credit models are fair and reliable. As they integrate deeper into the banking system, expect to see more streamlined loan products and potentially more competitive rates for everyday consumer purchases. The 'Upstart Bank' will focus initially on personal loans, which are a primary driver for major consumer purchases in retail and automotive sectors.

Source: American Banker — Top News

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