Following the announcement on Tuesday, shares of the financial technology company rose 8.5% in after-hours trading.
Once the deal concludes, Stride will be rebranded as Chime Bank and operate as a wholly owned subsidiary of the fintech firm.
The acquisition marks a significant shift in Chime's business model, transitioning it from a fintech platform that relies on third-party partners to a chartered bank.
By bringing these operations in-house, Chime intends to streamline its infrastructure and consolidate banking activities that were previously split between Stride and Bancorp Bank.
This move allows the company to gain more direct control over its financial services and customer accounts.
As part of its long-term strategy, Chime stated it intends to keep the bank’s total assets below $10 billion for the foreseeable future.
This specific threshold is often maintained by growing financial firms to manage regulatory requirements and operating costs.
While the two companies have worked together for over seven years, this merger officially integrates Stride’s existing banking framework directly into Chime’s corporate structure.