This digital bank gives some members their stimulus money before IRS checks
Top line: Digital bank Chime, valued at $ 5.8 billion, today released a new pilot program that will give 1,000 of its users immediate access to their $ 1,200 stimulus checks, while direct payments from the federal government can take between two and three weeks to arrive.
- The money will be available through Chime’s SpotMe feature, which typically allows customers to overdraft their accounts up to $ 100 at no charge; this means that Chime will use its own cash to deal with its users until the checks arrive from the IRS.
- “Americans need faster access to government stimulus payments,” Chime CEO Chris Britt said in a statement.
- CNBC reports that the idea for the program came after discussions with Mark Cuban, owner of the Dallas Mavericks, and the company says it hopes to roll out the feature to more customers over time if the first round is successful.
- Users eligible for the pilot are typically customers who deposit their paychecks directly into a Chime account and have also had their federal tax refunds deposited into that account, according to CNBC.
- Chime isn’t the first fintech to want to get stimulus money into consumers’ hands faster: “The technology exists to provide money to most people today (even those who don’t. have no bank account). Square
and many of our peers can. US government: let’s help ourselves ”, Jack Dorsey, CEO of Square noted Last week.
- Other fintech companies like Gusto and Plaid have also stepped in, but the reality of public / private partnerships is complicated due to the large amount of data involved.
Large number : Weekly jobless claims hit 6.6 million last week, more than double the expected 3.1 million, as the coronavirus continues to hit the economy – the highest level on record. All inclusive, over 10 millions Americans have lost their jobs because of the coronavirus.
Key context: President Trump enacted landmark law last week economic stimulus package worth $ 2,000 billion. The legislation includes $ 377 billion in federally guaranteed loans to small businesses so they can stay afloat and continue to pay workers, a $ 500 billion government loan program, expanded unemployment benefits and a aid to hospitals. Under the bill, most American adults will also receive a direct payment of $ 1,200 each and $ 500 per child (couples will receive $ 2,400), subject to income restrictions. Treasury Secretary Steven Mnuchin said eligible people can expect to receive the money within three weeks if the Internal Revenue Service has their bank account information and can make a direct deposit of the funds. (Others, who receive paper checks, will likely have to wait longer.)