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The need for second – and often third – incomes is increasing, according to a top digital bank executive.
Current CEO Stuart Sopp finds that nearly half of the company’s payment customers have more than one job.
“If you received a salary in the past year, 20, 25% of savers have at least one extra job. Another 20% of those work two jobs,” Sopp told CNBC’s “Fast Money” on Thursday. “They’re trying to make that money go further because of inflation.”
By DoorDash Unpleasant Shopify Sopp believes that the number of companies is higher than in previous years because the money does not go as far.
“Wage inflation is moderating quite a bit,” he said. “America has kind of a tail of two cities right now. Two groups: the rich and the less wealthy.’
Sopp launched Current in 2015, which offers mobile banking with no monthly fees and secured credit cards. It was originally aimed at helping middle to lower income customers. His company Current reports nearly five million members.
He is particularly concerned that less affluent consumers are falling into debt to meet their basic needs.
“They are pushed into taking risks, like risky credit cards,” said Sopp, a former trader at Morgan Stanley. “Unsecured credit cards…are not for everyone.”
The Federal Reserve Bank of New York found that credit card debt topped $1 trillion for the first time ever in the second quarter.
“It’s going to be a lot bigger this year,” Sopp said.
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