The LGBTQ+ community has a range of needs, including specific challenges around chosen names and family planning, that most traditional banks aren’t serving.
Daylight, a digital bank aimed at LGBTQ+ people, has raised $15 million to promote and expand features including debit cards with customers’ chosen names, increased cash back for spending at queer and allied businesses, guided financial goals for gender-affirming procedures (like top surgery or facial feminization), and family-planning resources, including a marketplace of IVF and surrogacy clinics.
Citi Ventures is a minority investor in the round, and its participation follows the bank’s efforts earlier this year to allow its transgender and nonbinary customers to assign a preferred first name to their debit cards. Many LGBTQ+ individuals say their legal identity doesn’t match their current chosen name, but most banks don’t offer an easy solution for switching out what’s on a user’s card. Helping customers avoid their deadnames is a relatively easy way many incumbents could appeal to their LGBTQ+ customers.
Daylight is one of a spate of neobanks to emerge recently to provide niche features aimed at specific demographics or causes, including immigrants, Black Americans, Asian Americans, and battling climate change. These challengers endeavor to build more loyalty and connection with customers than a traditional bank by deeply catering to their needs. And while incumbents may not be able to launch hyper-specific features like neobanks do, they should take note of the messaging, marketing, and types of programs.
Daylight’s fresh funding also comes at an intense moment for LGBTQ+ issues: The US Senate just took a crucial step in legally protecting same-sex marriages, while another horrific and deadly shooting took place at a queer nightclub over the weekend.