Industry-Wide Trends

Avant Seeks National Bank Charter to Serve Customers Directly

Fintech lender Avant applies for a national bank charter, aiming to lower costs and streamline its consumer credit offerings.

Avant is moving to become a fully-fledged national bank. Currently, this fintech lender operates by partnering with traditional banks to issue its personal loans and credit cards. By applying for a national bank charter with the OCC and FDIC, Avant is looking to cut out the middleman. For retailers and service providers who use Avant or similar fintech platforms to offer consumer financing, this is a major structural shift. If approved, Avant will have more direct control over its lending products and interest rates. Becoming a bank allows them to use their own deposits to fund loans rather than relying on external partners. This typically leads to lower costs for the lender, which can translate into more competitive rates for your customers or higher approval volumes. It also provides the company with more regulatory stability, as they would be governed by a single national framework rather than a patchwork of state-level rules. For your business, this likely means a more stable, long-term financing partner with a broader suite of financial products. However, the process of becoming a bank is long and rigorous, so don't expect immediate changes to your current merchant portal or customer terms just yet.

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