Fintech startup Chime has confirmed layoffs affecting 12 percent of its workforce.
It becomes one of the latest private tech businesses to slash employees as the economy continues to plummet.
Though 160 people from its 1,300 headcounts are hit, the firm says it is still hiring for specific roles and “remains very well capitalized.”
Chime provides fee-free banking, early paydays for direct deposit customers and a feature that allows users to go negative in their accounts without overdraft fees.
During the pandemic earnings before interest, taxes, depreciation, and amortisation (EBITDA) basis.
Tech giants Amazon, Alphabet, and Meta have all taken initiatives to cut costs.
However, others including Netflix, Spotify, Coinbase, Lyft and Shopify have announced job cuts.
Like Chime, online payments giant Stripe and NFT platform Dapper Labs also disclosed significant redundancies.
The financial technology business had rapid development throughout the pandemic, gaining millions of users and attaining a worth of $25 billion just over a year ago.
Understanding the vast swath of US clients who aren’t properly served by conventional brick-and-mortar banks is an important part of the company’s growth.
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The online banking firm primarily targets millennials earning between $35,000 and $70,000 per year.
This demographic rely significantly on debit cards to pay for regular purchases while keeping under budget.
Chime generates money mostly from the swipe fees paid by merchants.