Brex has just made an announcement designed to allow it to offer even more services to businesses. This could be an exciting new competition in the business credit cards space, especially if Brex has its own point currency.
Brex will have a wholly-owned subsidiary bank
Financial services company Brex has filed an application with the Federal Deposit Insurance Corporation (FDIC) and the Utah Treasury (UDFI) to establish Brex Bank, a wholly owned subsidiary of Brex. Brex Bank would be an industrial bank in Draper, Utah.
So far, Brex has focused on a new approach to corporate financial services by combining payment products with financial software. Brex has become the operating system for thousands of companies. Until now, Brex did not have its own bank, but used the Emigrant Bank as the issuer for their Brex Card.
With this announcement, Brex has hired Bruce Wallace as the proposed CEO of Brex Bank. He previously worked at Silicon Valley Bank (SVB) as Chief Operations Officer, Chief Digital Officer and Head of Global Services.
The Brex Card is currently being issued by the Emigrant Bank
What will change when Brex has its own bank?
With the establishment of Brex Bank, Brex plans to expand its existing suite of financial products and enterprise software to offer small and medium-sized businesses credit solutions and FDIC products for insured deposits (and to be very clear, deposits with Brex’s partner banks are already FDIC insured ).
The current Brex card issued with Brex Cash accounts is essentially a cross between a debit card and a credit card. It’s a World Elite Mastercard that is rewarded like a credit card, while your expenses are automatically debited from your Brex account like a debit card.
With the creation of Brex Bank, Brex could presumably begin issuing actual credit cards with credit limits, funding, etc.
Brex has been innovative in terms of its offering and I am very excited to have another competitor entering the market that can expand significantly over time. Brex is very well funded and has amassed nearly $ 500 million in venture capital to date. Perhaps the company will compete against Amex and Chase with its product offerings.
What I love about Brex is that unlike other fintech companies, Brex also has a focus on rewards and even has transferable points currency.
Brex has a transferable point currency and we have seen it continue to expand
Open a Brex Cash account and earn 110,000 points
One of Brex’s newest products is Brex Cash, a no-fee business cash management account. Opening a Brex Cash account is an incredible opportunity as you can earn up to 110,000 points (exclusive to OMAAT readers), there is no credit and the account has no fees. Points can be redeemed for one cent each or transferred to multiple airline partners in a 1: 1 ratio, which can be extremely valuable.
You can read all about Brex Cash in the following posts:
Brex plans to establish Brex Bank, a wholly owned subsidiary that the fintech company can use to expand its product offering. It’s always great to see innovation in the banking and credit card space, and I can’t wait to see what Brex brings in over time.