US Fintech Enova International Acquires Fully Licensed National Bank

Enova International’s agreement to acquire Grasshopper Bank, including its fully licensed national bank subsidiary, for approximately $369 million, is emblematic of a broader trend spanning the financial services and adjacent sectors where fintechs are moving to obtain banking charters, whether through application or acquisition, or expand their services and fortify trust with customers.

Merger and acquisition activity continues to soar. Two-thirds of executives expect M&A momentum to continue or increase over the next 12 to 24 months, with 26 percent predicting a strong uptick, according to the Exploring M&A trends and challenges in banking study, fielded  in April 2025 by TechStudio™, an Energize Marketing® company, and FIS®. Regional and community banks are actively pursuing growth through M&A, with 56 percent hunting for targets and 12 percent preparing to be acquired.

But this latest deal by Enova, which follows similar ones like LendingClub’s acquisition of Radius Bank in 2020 and SoFi’s acquisition of Golden Pacific Bank in 2022, marks a reverse of the traditional narrative: Instead of banks and traditional financial services institutions acquiring fintechs for their technology, now fintechs are buying banks for their regulatory status and funding advantages. For Enova International, owning a bank will allow the company to use low-cost deposits to fund loans and offer new products like checking or savings accounts. Moreover, given that Enova will effectively become a bank holding company, with Grasshopper Bank as its subsidiary, it will benefit from more stable regulatory oversight that could further cement consumer trust.

From a digital banking perspective, the latest deal shows that the sector is maturing rapidly. While the early 2020s saw a boom in standalone digital banks (also known as neobanks) attracting millions of customers with their user-friendly apps and no-fee accounts, profits often remained unsustainable. However, by 2025, the neobank sector had shifted towards sustainability and integration, with some being granted full banking licenses putting them on par with traditional banking institutions.

In a bid to keep up with the meteoric rise of neobanks, traditional banks have also been upping their game in recent years, further raising the bar for fintech challengers. For instance, JPMorgan has rolled out its digital bank Chase in more counties, while BBVA is launching new AI-powered tools to transform customer interaction. 

For digital banking startups, it’s never been more important to find a strong partner or buyer that can ensure their innovations can reach more customers before they run out of road. As the digital banking sector gets more crowded, and the lines between fintech and traditional banking blur, fintechs either need to find strong partners in incumbent banks or consider mergers with other fintechs whose products complement their own. In a market where scale, trust, and regulatory access have become vital competitive differentiators, Enova’s move is a clear sign that the future will likely belong to those who consolidate, instead of just innovate.