The decade-old credit-card startup named a SoFi alum and longtime regulator as CEO of its proposed bank.
Upgrade has applied for an industrial loan company charter with the Federal Deposit Insurance Corp. and the Nevada <a href="https://bitcomme.com/salesforce-inc-crm-stake-trimmed-by-fragasso-financial-advisors-inc/” title=”Salesforce Inc. $CRM Stake Trimmed by Fragasso Financial Advisors Inc”>Financial Institutions Division, the fintechannounced Monday.
“We are excited at the prospect of establishing a new bank that will advance Upgrade’s mission of bringing responsible and affordable credit to consumers,” Virginia Varela, proposed CEO of Upgrade Bank, said in a statement.
Varela brings more than 40 years of experience in the banking sector – first, as a regulator. She spent more than two decades with the Office of the Comptroller of the Currency, and another two years as a senior bank examiner with the Federal Reserve, before specializing in bank turnarounds after the 2007-08 financial crisis, according to herLinkedIn profile.
Varela was CEO of Sacramento, California-based Golden Pacific Bankwhen SoFi bought the lender. She became head of SoFi’s community banking unit but left in July 2025 for Upgrade, where she is head of banking strategy.
Varela will serve on Upgrade Bank’s board alongside Upgrade co-founder and CFO Jeffrey Bogan, the company said. Raymond Specht,onetime CEO of Toyota Financial Savings Bank, will serve as an independent director on the board.
Upgrade launched roughly a decade ago as a credit-card startup but graduallyexpandedto encompass personal loans,mobile banking,auto financingandbuy now, pay later. The fintech has delivered about $53 billion in credit to roughly 8.5 million customers, it said.
Upgrade counts Cross River and Celtic Bank as partners on loans, credit lines and banking services. An ILC charter would make Upgrade less dependent on those relationships.
Trump-era regulators have seen asharp increase in new charter applications. FDIC ChairTravis Hilllast year touted the ILC charter as one of a handful of ways to boost the establishment of new banks.
Rent fintechFlexand BNPL juggernautKlarnaapplied for ILC charters in July. Car makerStellantisreceived approval in May to launch an ILC. Other automotive stalwarts, includingFord and GM,got green lights in January. Investment firmEdward Jonesfollowed in February.
Some lawmakers, with backing from the banking industry, have argued that an ILC charter exempts companies from the definition of a “bank” under the Bank Holding Company Act. As long as ILCs don’t offer demand deposit accounts, they can bypass oversight by the Federal Reserve, the politicians contend.
The trade group Independent Community Bankers of America said in May thatcutting the Fed out of ILC supervision“leav[es] a dangerous gap in safety and soundness oversight and introducing unnecessary systemic risk into the banking system.”
Last year, Sens. Elizabeth Warren, D-MA, and Andy Kim, D-NJ,proposed a moratoriumon commercially owned ILC charters until such entities are defined as “banks” under the BHC Act.
