Chime has laid off 12% of its staff, or about 160 employees, becoming the latest big-name fintech firm to cut jobs in this year's downturn.
A spokesperson confirmed the number of layoffs, which were first reported Wednesday by The Information. "To ensure the long-term success of the business and as we look at current market dynamics, we are focusing our organization to be fully aligned with our company priorities," the company said.
In a memo to staff reported by TechCrunch, co-founder and CEO Chris Britt said the company remained "well-capitalized" and the cuts were among moves to position the company for success "regardless of market conditions."
Chime is a leader among a group of neobanks such as Current and Varo that offer checking accounts and other banking services for people who are unbanked or underbanked. Varo conducted layoffs earlier this year, cutting about 75 jobs, which represented 10% of its staff, in July.
Chime has raised more than $2.3 billion in venture capital funding since its founding in 2013, according to Crunchbase. Its most recent round, $750 million in August 2021, came at a $25 billion valuation. It had more than 14 million customers as of May, according to research from Cornerstone Advisors.
Neobanks typically rely on collecting interchange fees on card swipes for most of their revenue — and few have reached profitability (though Britt did tell CNBC in 2020 that Chime became profitable on an EBITDA basis at the start of the pandemic).
Meanwhile, venture investment into the neobanking sector has slowed significantly from the boom times of late 2020 and 2021. Banking-focused startups raised $24.7 billion from investors in 2021, according to CB Insights, compared to $7.6 billion in first nine months of 2022.
Correction: This story was updated on Nov. 2, 2022, to correct the date of Chime's latest funding round.