Upgrade applies to establish Upgrade Bank as a Nevada-chartered industrial loan company
The fintech filed applications with Nevada regulators and the FDIC for a proposed FDIC-insured bank subsidiary that would complement its existing lending and bank-partner model.
Upgrade, Inc. announced October 12 that it had submitted applications to the Nevada Financial Institutions Division and the Federal Deposit Insurance Corporation to establish Upgrade Bank.
The proposed subsidiary would be a Nevada-chartered, FDIC-insured industrial loan company, subject to regulatory review and approval. Upgrade said the bank would complement its existing bank-partner relationships and loan-funding operations while operating with independent governance.
For Upgrade, a charter would change the company's relationship with the banking system, but it would not make the application an approved bank or guarantee a particular business model. The process requires regulators to assess the proposed institution, its controls, capital and governance before any charter or deposit-insurance approval can take effect.
The company did not announce a guaranteed approval date or provide a new financial forecast tied to the application. Until approvals are granted, Upgrade remains an applicant for a proposed subsidiary rather than an operating FDIC-insured bank under the new structure.