Wells Fargo is facing financial strain due to a credit card deal with Bilt, where the bank is losing $10 million monthly. The co-branded card allows users to earn rewards points on rent payments, leading to significant losses for Wells Fargo as renters are mainly using the card for rent payments and paying off balances early, rather than carrying balances as expected. The bank is now renegotiating the deal with Bilt after inaccurately projecting key revenue drivers.
The Bilt Wells Fargo issue is relatively simple… An already billionaire founder + former AMEX CEO/Chairman for 17yrs who subsequently became chairman and managing director of General Catalyst Partners that invested $200M went to Wells Fargo to make a deal. Talk about leverage…
I thought the Bilt-Wells Fargo situation is among the most hilarious proptech misadventures I've seen. So I made a video about it. https://t.co/6EDhoJXYdg
Wells Fargo may pull the plug on a popular credit card https://t.co/k00FHLmOEP
Card issuer Wells Fargo is losing as much as $10 million a month as it eats interchange fees for users who are paying off balances after paying their rent, "The Wall Street Journal" reports. https://t.co/ZmCjXJmZRM
the thing about the bilt card, is everyone should realized that card rewards point get paid by someone. if first there wasn’t cash back for rent and now there is. someone is paying for it
The WSJ article was great marketing for Bilt- “hey wait, this is a bad deal for Wells? I want in” My tweet on the topic got 2.6M impressions- I threw a referral link in the last tweet and 40 people signed up for the card, earning me $2,250 (1.25c/point if used on travel) https://t.co/9LNEjF5Ggh https://t.co/03cZeXhJKv
Revenue projections off because card users aren’t carrying balances. Hurrah! Wells Fargo is renegotiating its credit-card deal with Bilt. https://t.co/n1fybWaGBT via @WSJ
Exclusive: You can pay your rent with this credit card and earn rewards. The bank behind it is losing millions every month. https://t.co/4lKwCxxhKS https://t.co/4lKwCxxhKS
You can pay your rent with this credit card and earn rewards. The bank behind it is losing millions every month. https://t.co/0hXasB6W3i https://t.co/0hXasB6W3i
A new Wells Fargo credit card program with a novel feature – you can use it to pay your rent – has not worked out quite as the bank had hoped. https://t.co/zo4FXJzufU
"Credit cards have become a much more important payment mechanism as well as lending mechanism," Wells Fargo CEO Charlie Scharf said last month in discussing why he likes credit cards over the home mortgage business. But how is Wells faring in this area? https://t.co/TozWqMuglE
Wells Fargo partnered with a startup named Bilt to launch a credit card that lets you pay your rent without incurring charges from landlords and earning points. The bank is losing $10M a month as most people who signed up for the card are paying balances early. https://t.co/RnsVCBs8Hs
Also: This is a reminder of resiliency of many renters, often underestimated. "Wells expected that around half to three-fourths of dollars charged to the card would carry over from month to month, generating interest charges. The reality ranges between around 15% and 25%." https://t.co/arQ0Gkgs0R
This is a crazy story for anyone familiar with the credit card (Bilt) designed for renters paying their monthly rent. The WSJ is reporting that Wells Fargo (the bank behind the card) is losing $10mm/month on Bilt and is trying either renegotiate or wait out the contract's… https://t.co/c3NyEyyjL1
That's a lot of red ink for Wells Fargo. https://t.co/vXMM10M4vd
“Wells [pays Bilt about] 0.80% of each rent transaction, even though the bank isn’t collecting interchange fees from landlords. Wells earns interchange fees every time people use the card to pay for anything but rent and splits those fees with Bilt. Wells also pays Bilt $200… https://t.co/dJJfvMFSb8
$WFC | Wells Fargo's Co-Branded Credit Card Strategy For Rent Payment Faces Challenges, Puts Financial Strain The co-branded card allowed users to pay rent without incurring landlord fees and earn rewards points.
$WFC | Wells Fargo's Co-Branded Credit Card Strategy For Rent Payment Faces Challenges, Puts Financial Strain The co-branded card allowed users to pay rent without incurring landlord fees and earn rewards points. Wells Fargo has informed Bilt that it will not renew the… https://t.co/NNyZl21tv2
Wells Fargo is losing $10M/ month on Bilt, per current and former employees. Executives made internal projections on key revenue drivers, such as the likelihood that cardholders would carry balances, that turned out to be inaccurate. https://t.co/5o7adiWCR4
Sources: Wells Fargo's credit card with fintech startup Bilt, which gets points on rent payments and saw 1M+ signups in 18 months, costs the bank up to $10M/mo. (Wall Street Journal) https://t.co/Qj9PTHmI7r 📫 Subscribe: https://t.co/OyWeKSRpIM https://t.co/z6ZUIDB20D
CAC bites back hard. Bilt's card doesn't charge landlords. Wells Fargo instead pays Bilt ~ 0.80% of rent, even though the bank isn’t collecting interchange fees. The cross-sell by Wells (eg non-rent fees; credit balances) isn't meeting projections. https://t.co/RjLEGY2Kp4
Seeing Wells Fargo losing millions to Bilt https://t.co/w1JeJtz7z8
Most thought Bilt was a case of VC subsidies: "use this card and earn points on rent, sponsored by VCs!" In reality, its growth is subsidized by the third largest US bank. Wells is losing $10m/month on Bilt. But, how did Wells get here? The credit card market is saturated -… https://t.co/aWkhuI0ac1
Most thought Bilt was a case of VC subsidies: "use this card and earn points on rent, sponsored by VCs!" In reality, its growth is subsidized by the third largest US bank. Wells is losing $10m/month on Bilt. But, how did they get here? The credit card market is saturated - the…
This bank STILL can't get out of its own way. What a joke. Wells Fargo is renegotiating its credit-card deal with Bilt after incorrectly forecasting key revenue drivers https://t.co/uswvnYPZW4
You love to see it. Wells Fargo thought that Bilt Card users would carry balances and wouldn't be savvy enough to take advantage of their points scheme on rent day Now they're losing 10 million a month https://t.co/I9Ha6re7q9
This bank STIOLL can't get out of its own way. What a joke. Wells Fargo is renegotiating its credit-card deal with Bilt after incorrectly forecasting key revenue drivers https://t.co/uswvnYQxLC
Wells Fargo losing $10M/mo on a credit card that gives rewards points for rent payments. They expected renters to also use the card for other purchases but renters are just farming the rent points and paying off balances to avoid interest. Farmers gonna farm. Lessons in there. https://t.co/7MaCX0AdhH
Wells Fargo losing $10M on a credit card that gives rewards points for rent payments. They expected renters to also use the card for other purchases but renters are just farming the rent points and paying off balances to avoid interest. Farmers gonna farm. Lessons in there. https://t.co/GlINhyT0ZK
Is there something about bank culture or negotiation strategy that is responsible for them ending up with the short end of the stick with credit card deals? Goldman Sachs / Apple and now BILT / Wells Fargo. (Signed up for BILT 2 months ago and it’s a now a go-to for me) https://t.co/jpTl3S6oIp
Wells Fargo Bet on a Flashy Rent Credit Card. It Is Costing the Bank Dearly. https://t.co/f05s6muZ1E
I signed up for BILT because the points you can earn on rent is wild. You can ALSO link your non bilt cards and earn points 🤯 (They sell the transaction data im sure) I never carry a revolving balance...sorry WF 😂 https://t.co/OEDGlB4qSD https://t.co/tiK8dAD2mS
Wowwwww Everyone in fintech has been saying that the Bilt credit card ($3.1B valuation) is too good to be true; How can you get cash back on rent payments? Turns out they have an unsustainable deal with Wells that is losing the bank hundreds of $millions. Wells made a number of… https://t.co/rBhUI1Cl0s
This article is wild. Wells agreed to a co-branded program that most big banks passed on, mismodeled every key assumption, is losing $10M a month with no path to profitability, and Bilt raised money at $3.5B valuation on an economically unviable contract. https://t.co/N3pzXcmWIq
Wells Fargo is renegotiating its credit-card deal with Bilt after incorrectly forecasting key revenue drivers https://t.co/hZIOzDKNKS