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Zero Financial raises $20M to scale mobile banking

Zero Financial Inc. said it raised $20 million in Series A financing led by New Enterprise Associates, which will be used to help scale the business to enroll about 200,000 people that are currently on a waitlist for the mobile banking fintech.

The San Francisco-based fintech provides customers with a combination banking product that includes a rewards credit card, called Zero Card, and a FDIC-insured checking account called Zero Checking. Transactions are displayed through a mobile app that combines activity into a net number to provide a more comprehensive view of spending.

The Zerocard product is a World Mastercard that gives customers a higher level of cashback rewards when they refer friends to the service. For example, they start off at 1% cashback through a Quartz card and when they refer a friend to the card that increases to 1.5% Graphite card. The referral upgrades go up to Magnesium-level card with 2% cashback and Carbon-level card with 3% cashback as you successfully refer more friends.

"Few people understand how complex it is to launch a credit card or checking account program," Rick Yang, a partner at NEA. "Zero is the first U.S. startup to launch a fully integrated and elegantly designed product with both from scratch."

He added that Zero Financial gives customers the ability to completely control and understand what they spend, without compromising on rewards benefits, which he says is lacking in traditional banking accounts.

Zero has a partnership with Salt Lake City-based WebBank, to issue Zerocard. Deposits are held by Memphis, Tennessee-based Evolve Bank & Trust, which is FDIC insured.

The company has raised a total of $35 million in debt and equity from a range of investors, including NEA, SignalFire, Eniac Ventures, Nyca Partners and Silicon Valley Bank.