Naples Florida Weekly
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The Motley Fool Take

Down With Great Potential

The concept of online banking has been around for a few decades now, but SoFi Technologies (Nasdaq: SOFI) is going about it a little differently. Instead of offering an attractive niche product (like a high-yield savings account), SoFi’s goal is to offer everything its customers need and get them to abandon their current banks altogether. As if that wasn’t ambitious enough, SoFi also owns the Galileo “fintech” (financial technology) platform; emulating Amazon Web Services, SoFi has said it wants to “build the AWS of fintech.”

Recent results certainly have been impressive. SoFi has grown its membership base by 450% over the past three years to over 4.7 million, and it has done a great job of increasing adoption of its checking, savings and credit card offerings. This should help create a natural marketing funnel for its high-profit lending products. Galileo has grown by leaps and bounds as well; it recently had 124 million customer accounts on its platform, about 39% more than just a year ago.

SoFi’s ramp-up in consumer banking is even more impressive when you consider that the company has had a banking charter for less than a year. With its tremendous growth momentum, SoFi could potentially grow to many times its current $5 billion market value over time. That’s far from guaranteed, but for risk-tolerant long-term investors, this company is worth a closer look. ¦

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