Oxygen gets $2.3m funding for digital banking life
San Francisco-based digital banking service Oxygen has raised $2.3 million in funding to breathe life into its gig economy plans.
The Y Combinator-backed firm says it offers free banking services and flat-fee, zero-interest credit lines to freelancers.
In this round it got funding from Digital Horizon Capital; Cynthia Chen, investor, advisor, executive and board member for several US-based fintechs and now co-founder and chief risk officer at Figure; ZMT Capital (China); Locus Ventures; Endure Capital; PioneerFund; Magic City; Light Bridge; Strawberry Creek; Base Ventures; The House Fund and Sam Yam, co-founder of Patreon.
Hussein Ahmed, founder and CEO, Oxygen, says: “Even the most affluent freelancers are often denied lending services due to their variable incomes. Oxygen is the only digital banking service offering modern banking services with no fees combined with fair credit line offerings, based on an intelligent, artificial intelligence (AI) driven analysis of individual freelancers’ income flows.”
Oxygen tracks freelancers’ bills, projects their income and offers instant credit – a “unique service combination that no other bank or payday lender offers”. Its service is accessible through its mobile app which is available in iOS and Android versions.
The funding will be used to expand the team and fuel (unspecified) business growth.
Oxygen cites Intuit and Emergent research, which states that freelancers currently comprise 34% of the US workforce and this figure is expected to grow to 43% by 2020.
The World Economic Forum predicts that by 2027, the majority of the US workforce will be freelancers.
Oxygen adds that it has achieved “significant” traction, with more than 13,000 bank accounts opened over the last several months; a single digit default rate; a 19% return on capital and a $10 million line of credit.
Across the States, there are plenty of other challenger banks springing up. Check out the lively list here.