Majority raises USD 37.5 mln

The digital bank, whose bundled services include a Federal Deposit Insurance Corp. (FDIC)-insured account, debit card, remittance, and international calling, received USD 30 million from Valar and Heartcore Capital, as well as USD 7.5 million in debt financing from a US-based commercial bank.

Majority, which first launched its digital banking platform in 2019 to serve the large Nigerian immigrant community in Houston, also announced the opening of three new locations in Florida, as well as a new location in Houston.

Part of the digital bank’s strategy to reach its target demographic is to establish physical ‘meet-up centers’ in communities with large immigrant populations. As the neobank looks to attract more of the country’s immigrant population, it has focused on solving several pain points the demographic faces in accessing banking and navigating life in the US.

Majority announced in 2021 that users could register for an account without a Social Security number or US documentation. Applicants only need international government-issued identification and some proof of US residence to open an account on the platform.

Financial difficulties for immigrants

Immigration is increasingly essential in driving future economic growth. However, the banking sector in most countries is not geared to serve this segment of the population. Accessing even basic financial services can be a major challenge for many newcomers, who may lack language and financial skills, and who are considered a niche market for many high street lenders.

Immigrants are much more likely than native-born peers to be unbanked or have no bank accounts of any kind. The incidence of being unbanked in immigrant communities is 13% higher than the native-born population.

For many immigrants, challenges in consumer finance limit, slow, and frustrate the process of achieving full participation in American life. When immigrant consumers face systemic barriers and harmful practices, they are often unable to take the steps that advance towards home ownership, small business growth, and other wealth creation that ultimately benefit families and communities.

Fintech for immigrants

There is already a problem with financial literacy in the US, 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 there. 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, traditional banks may be looking for partnerships with fintech providers in order to keep up with the rise of standards for financial products.