Upgrade applies for industrial loan company charter to bring deposit-taking in-house

Upgrade, the San Francisco-based consumer credit platform co-founded and led by Renaud Laplanche, has applied for an industrial loan company (ILC) charter, according to reporting by American Banker and corroborated by multiple secondary sources. The application — which secondary sources including Banking Dive, Fintech Futures and The Bank Slate indicate was filed in Nevada — would, if approved, allow Upgrade to operate its own deposit-taking institution.

What Upgrade Has Filed

Upgrade has submitted an ILC application, with secondary sources consistently describing the filing as a Nevada Industrial Bank charter. The FDIC's bank-applications process is also implicated: under FDIC procedural guidance, ILC applications typically require approval from both the FDIC for deposit-insurance purposes and the relevant state regulator. The Nevada filing jurisdiction has not been confirmed from a primary Nevada state source — specifically the Nevada Department of Business and Industry's Financial Institutions Division — and should be treated as reported rather than formally verified at this stage.

An ILC charter, as described in FDIC procedural guidance, permits a non-bank parent company to own a deposit-taking institution without being subject to the full supervisory regime applied to bank holding companies under the Bank Holding Company Act. That structural distinction has made the ILC route attractive to a number of fintech firms seeking to bring deposit-funding in-house.

Upgrade has delivered more than $40 billion in credit to over seven million customers since its founding — a scale that underscores the strategic rationale for securing a direct funding base through a bank charter.

Upgrade's Business at a Glance

Founded in 2017 and headquartered in San Francisco, Upgrade operates across six product lines: personal loans, credit cards, mobile banking, buy now pay later, auto financing and home improvement financing, according to the company's own published materials. As of 6 August 2025, Upgrade reported surpassing $40 billion in total loan originations and serving more than seven million customers. Laplanche serves as co-founder and CEO.

The Broader ILC Landscape

Upgrade is not alone in pursuing this route. Utah's Department of Financial Institutions lists Klarna, Albert and Flex Bank among fintechs with active ILC applications on file, according to the Utah DFI's published application-status page. Whether PayPal remains an active Utah applicant could not be confirmed from the available source material and has been omitted pending verification.

ILC applications have historically involved lengthy review periods and formal public comment phases, according to FDIC procedural guidance. The regulatory process means that an application filing represents the beginning, not the conclusion, of a path to charter approval.

What Remains Unconfirmed

Several details reported elsewhere have not been verified against primary sources and are excluded from this article:

• Bank CEO identity. Reports have circulated that Upgrade has named a senior executive to lead the proposed bank subsidiary. No name, biography or confirmation appeared in the primary source material reviewed for this article. The Fin Desk is not reporting this claim.
• Filing jurisdiction confirmation. While multiple secondary outlets describe the application as a Nevada filing, a primary Nevada state-regulatory source has not been consulted to confirm the state's ILC framework or the application's formal status there.
• Capital commitments and filing date. Neither a capitalisation figure nor a precise application-submission date appeared in the verified source material.

Why It Matters

An ILC charter would represent a material structural shift for Upgrade. Fintech lenders that operate without a bank charter typically rely on partner banks for deposit funding and are subject to those banks' credit policies and pricing constraints. Owning a chartered institution could give Upgrade direct access to deposit funding and greater control over its product economics across its six lending and banking verticals. The application places Upgrade alongside a cohort of consumer fintechs testing regulatory appetite for ILC approvals — a process that, based on FDIC procedural history, is measured in years rather than months.

Reporting based on primary sources from Upgrade, the FDIC and the Utah Department of Financial Institutions, supplemented by secondary reporting from American Banker, Banking Dive, Fintech Futures, PYMNTS and The Bank Slate. Details subject to update as the application advances.