The End Of Bilt Card?! Wells Fargo Losing $10 Million/Month | Wall Street Journal Reaction

The Nugget

Wells Fargo is considering not renewing its contract with Built Card, potentially leaving Built without a bank partner, due to significant financial losses.

Make it stick

🔑 Wells Fargo is losing $10 million per month on the Built Card program.
🔑 Built's success could be impacted by the renegotiation of its contract with Wells Fargo.
🔑 Operational improvements and higher engagement from users are potential solutions for Built to address the financial challenges.

Wells Fargo is facing financial losses of up to $10 million per month due to its partnership with the Built Card.
Wells Fargo's reluctance to renew the contract with Built could jeopardize the future of the card program.
Built Card's rapid growth and customer acquisition have created financial strain for Wells Fargo.

Built Card was launched in 2022 to allow users to earn points on rent payments without transaction fees.
Despite its success with customers, Built Card is facing challenges with Wells Fargo over the financial viability of the partnership.
Wells Fargo's dissatisfaction with the economics of the Built Card program has led to potential contract renegotiations.

Wells Fargo may consider paying Built less for rent payments or requiring more card usage from customers to improve profitability.
Increasing the interchange fee split, reducing fees for rent payments, or adding an annual fee with credits are levers Built could consider pulling to address financial challenges.
Operational improvements, such as requiring more card swipes per month or finding ways to increase card usage, could help Built mitigate financial losses.

"Wells Fargo is losing as much as 10 million every month on the program, and a lot of it from savvy customers."
"Having an annual fee with other credits helps other cards do really well, as more people sign up due to the added benefits."
"Financial losses have triggered the renegotiation. Wells Fargo telling Built that they don't intend to renew the contract unless the economics change in their favor."
"The Bread and butter of the Built Card is young professionals in major cities, and the majority of cardholders are new to Wells Fargo."
"Built is a much bigger platform than just a co-branded card, with less than 15% of members having a Built co-branded card."

This summary contains AI-generated information and may have important inaccuracies or omissions.