Upgrade applies for ILC charter

Upgrade, a major player in the consumer credit and 'buy now, pay later' space, is moving to become a full-fledged bank. By applying for an Industrial Loan Company (ILC) charter in Nevada, the company aims to move away from relying on partner banks to fund its loans. For retailers and merchants using Upgrade’s financing products, this is a signal of long-term stability. If granted, the charter allows Upgrade to hold its own deposits and fund consumer loans directly. This usually leads to lower capital costs for the lender, which can translate into more competitive rates or higher approval ceilings for your customers. This move follows a trend of successful fintechs seeking bank charters to gain more control over their operations. Upgrade has already signaled its seriousness by hiring a former SoFi executive and a veteran regulator to lead the proposed bank entity. While the application process is rigorous and can take time, the outcome could give Upgrade more flexibility in how they structure credit products. For now, there is no immediate change to how you offer Upgrade to your customers, but it suggests the lender is doubling down on its commitment to the consumer credit market.

Source: Payments Dive

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