Rick Munarriz, The Motley Fool

Mon, Jun 16, 2025, 6:15 AM5 min read

• Chime spiked when it went public on Thursday, but it's trading substantially lower heading into this week of trading.

• The platform is popular, with 8.6 million active accounts accounting for just 3% of its current target audience.

• Engagement is rising, growth is accelerating, and it turns profitable in its latest quarter. These are all encouraging signs.

• 10 stocks we like better than Chime Financial ›

One of this year's most anticipated IPOs hit the market last week. Demand was strong for Chime's (NASDAQ: CHYM) offering. Underwriters were hoping to take the online banking specialist public between $24 and $26 a share, and they pushed it up to $27 on the eve of its exchange-traded debut.

Chime stock opened at $43 when it eventually began trading three hours after Thursday's opening bell. But it went largely downhill from there. The shares closed at $37.11 on its first day of trading and then slid another 6% on Friday.

Is it too late to buy Chime? No. The stock is still 29% above the underwriters' $27, but the shares enter this new trading week fetching less than what those who chased it during its first two days on the market had to shell out.

There's a lot more to the Chime story than its limited post-IPO history. Let's see if it can ring a bell.

Chime operates a growing fintech platform. As a branchless bank, or neobank, Chime offers online and mobile app access to basic banking services, including checking, high-yield savings, and debit cards. Unlike traditional brick-and-mortar institutions, Chime sweetens the pot with no account minimum fees and complimentary overdraft protection. Set up a direct deposit, and you can generate a healthy 3.75% yield on the idle cash in your savings account.

The appeal is clear. The company's target audience is currently the 196 million Americans generating less than $100,000 annually, and it currently has less than 3% of that market penetrated among its 8.6 million active customers. This is a group that can sometimes live paycheck to paycheck, and Chime has lots of things that make it attractive to a widening user base, including a compelling fee schedule, flexibility, and the MyPay program that can advance up to $500 from an incoming direct deposit at no cost if it hits the account within 24 hours. Two-thirds of Chime users consider Chime their primary banking account.

Chime hit the market at a good time. Revenue growth is accelerating. Its top line rose 27% in 2023 and stepped up to 31% growth last year. The top line came through with a 32% year-over-year increase in the first quarter of this year. The 8.6 million accounts the company currently services is a 23% jump over the past year and 82% over the past three years.