COVID-19 Driven Boom? SoFi Sees Record Number of New Accounts

Anthony Noto, CEO of SoFi, visited with Jim Cramer of CNBC’s Mad Money show this week and shared some insight into SoFi’s performance during the COVID-19 induced lockdown. Noto said that contrary to what many other businesses are experiencing, the Fintech has seen a record number of account openings.

Cramer called SoFi the banker to young people. Noto said they have been telling the youth they are open for business (unlike a lot of bank branches that are shuttered right now).

“We are 100% on your mobile phone … we can help them do what they need to do with their money from a personal standpoint,” without ever leaving their home.

Noto suggested they switch to a direct deposit to the SoFi app. He explained that SoFi can do just about everything a traditional bank can do, and perhaps more, minus the fees associated with brick and mortar banks.

Noto said that SoFi currently has over a million “members” that they serve. Borrow, save, spend and invest.

SoFi started its Fintech existence as a student loan refinancing platform. Today, student loans are just one of a portfolio of financial services offered. During these challenging times, SoFi is offering deferred payments on these loans as well as other personal credit.

Noto also mentioned a feature where SoFi will enable a seamless experience for small business loans offered by an unnamed marketplace lending platform.

“We are actually seeing a record number of new account openings and inflows,” said Noto. “We have been pretty surprised by the activity. Our assumption is that there have been many young people who have been sitting on rainy day funds and have been waiting for an opportunity to start investing so we are seeing a significant acceleration in the number of new accounts as well as net flows in.”

Noto said they are pleasantly surprised that people are using the pull-back in stocks as an opportunity to invest.

“People are actually buying the dips.”

Noto believes that if you are investing over the long term this is an opportunity to build a diversified portfolio.


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