Sacra estimates that Choice Financial Group generated $315 million in total revenue in 2024, down 22% from $403 million in 2023. Net interest income increased 2.4% to $142 million in 2024 despite the overall revenue decline, as Choice maintained deposit cost discipline while interest expenses fell 13% even with Federal funds averaging 160 basis points higher year-over-year.

Non-interest income dropped 61% to $46 million in 2024 as the revenue mix shifted heavily toward traditional banking operations. Beyond the insurance divestiture impact, recurring fee revenue from banking-as-a-service partnerships compressed due to regulatory oversight on sponsor bank fees and reduced consumer spending affecting interchange revenue from partners like Mercury and Current. Choice's provision for credit losses remained stable at $8.2 million, reflecting continued strength in its North Dakota and Minnesota agricultural and commercial portfolios.

Choice Financial Group remains privately held with local ownership concentrated among North Dakota investors and community stakeholders. The bank raised over $100 million in 2018 from local investors to finance the acquisition of Venture Bank, nearly doubling its size to around $2 billion in assets at the time.

Total external equity raised over the years amounts to approximately $120 million across various private offerings. Additional smaller raises occurred in 2010, 2017, and 2019 to support growth and acquisitions.

Choice operates as a hybrid community bank and banking-as-a-service platform. On the traditional side, customers can walk into one of 20 branches across North Dakota and Minnesota to open checking accounts, get business loans, or obtain mortgages with personalized service from local staff who understand regional markets.

What makes Choice unique is its fintech partnerships. A user of apps like Current or Mercury technically holds a Choice Bank account without ever knowing it. When someone opens a digital account through these fintech apps, Choice provides the regulated banking infrastructure - the FDIC insurance, payment processing, and account management - while the fintech provides the user interface.

For fintech users, the experience is seamless. They interact entirely through the partner app for deposits, transfers, and payments. Choice handles all the behind-the-scenes banking operations, compliance, and connects directly to Federal Reserve payment systems. The bank even developed a virtual FedLine connection to process wire transfers electronically for fintech clients, speeding up transactions that traditionally required manual processing.

Choice also builds specialized software platforms. Their Choice Ag Solutions lets farm supply dealers offer instant financing to farmers at the point of sale, competing with national agribusiness finance companies that were capturing local lending business.

Choice creates value through a dual-channel approach combining relationship-driven community banking with scalable fintech partnerships. The bank's People First philosophy emphasizes local decision-making and personalized service, building deep customer relationships that generate loyalty and cross-selling opportunities.

The go-to-market model operates as both B2C and B2B2C. Direct customers access Choice through branches and digital channels for traditional banking services. Simultaneously, the B2B2C model serves millions of end-users through fintech partnerships without those customers necessarily knowing Choice's name.

Choice monetizes through multiple revenue streams. Traditional net interest income comes from lending local deposits plus low-cost fintech deposits to fund agricultural loans, commercial real estate, and SBA lending. Non-interest income includes interchange fees when fintech users swipe debit cards, partnership fees from fintech deals, and wealth management commissions.

The bank maintains lean operations relative to its asset size with approximately 500 employees managing over $5 billion in assets. It leverages technology partnerships for core banking software while building custom solutions like direct Fed connections where strategic value exists. This hybrid approach allows Choice to compete on both personal service locally and technological sophistication nationally.

The model creates self-reinforcing dynamics where fintech partnerships provide low-cost funding for traditional lending while community banking provides stable deposits and regulatory credibility that attracts fintech partners seeking reliable sponsor banks.

Choice competes directly with institutions like Bell Bank, Bremer Bank, and Gate City Bank across North Dakota and Minnesota. These banks share similar agricultural expertise and community focus, competing primarily on relationship quality and local market knowledge. Choice differentiates through faster decision-making, broader product integration, and recognition as the top agricultural lender in North Dakota. While competitors focus solely on traditional banking, Choice's fintech partnerships provide additional funding sources and revenue streams unavailable to purely local players.

In the fintech sponsor bank space, Choice faces competition from Cross River Bank, Evolve Bank & Trust, Metropolitan Commercial Bank, and WebBank. These institutions have built specialized BaaS platforms targeting fintech partnerships exclusively. Cross River emphasizes venture capital backing and rapid scaling, while others focus on specific niches like prepaid cards or crypto services. Choice positions itself as offering Midwestern reliability combined with innovation, appealing to fintechs seeking stable, well-managed partners rather than purely growth-focused sponsors.

Large banks like Wells Fargo and U.S. Bank compete for Choice's commercial customers in Minneapolis-St. Paul with greater scale and technology resources. Choice counters with local decision-making authority and personalized service that large institutions struggle to match. Rather than compete directly with fintech companies, Choice has co-opted many potential disruptors by partnering with apps like Current and Mercury, effectively turning competitive threats into revenue-generating partnerships while gaining insights into digital banking trends.

Choice can significantly expand by adding more fintech partnerships across different verticals. Current partnerships focus on consumer banking and startup accounts, but opportunities exist in health savings accounts, gig economy payments, international transfers, and specialized lending platforms. Each new fintech vertical opens access to millions of potential users without geographic constraints, effectively making the entire U.S. market addressable through digital partnerships rather than physical expansion.

While Choice serves all 50 states through fintech partnerships, its direct banking presence remains concentrated in North Dakota and Minnesota. Strategic acquisitions in adjacent markets like South Dakota, Iowa, or Montana could expand the traditional banking footprint. The bank could also target demographic expansion by partnering with fintechs serving underbanked communities, international populations, or specific age groups, broadening its customer base beyond rural and small-business focused segments.

Choice can leverage its platform to offer new services like lending-as-a-service through fintech partners, treasury management APIs for business-focused apps, or specialized financing platforms for additional industries beyond agriculture. The bank's direct Federal Reserve connections and compliance infrastructure provide competitive advantages for fintechs needing sophisticated payment processing or real-time settlement capabilities, opening opportunities in emerging payment technologies and financial services.

Regulatory compliance: Choice faces ongoing regulatory scrutiny following a December 2023 consent order requiring enhanced anti-money laundering controls and board oversight of fintech partnerships. The bank must strengthen customer identification programs and suspicious activity monitoring while managing millions of end-customers from partner platforms. Failure to adequately address compliance gaps could result in fines, growth restrictions, or loss of fintech partnerships that drive significant revenue.

Fintech concentration: A substantial portion of Choice's deposits and fee income derives from fintech partnerships, creating dependency on these relationships. If major partners like Mercury switch to other sponsor banks or if fintech partners face business difficulties, Choice could lose significant funding sources and revenue streams. The bank must continuously compete with other sponsor banks on technology capabilities, economic terms, and service quality to retain these partnerships.

Credit exposure: Choice's loan portfolio carries concentrated exposure to agriculture and commercial real estate markets, making it vulnerable to commodity price volatility, weather events, and economic cycles. While geographic diversification through the Twin Cities presence helps, agricultural lending remains a core competency and significant portion of the portfolio. Economic downturns affecting farming communities or commercial property values could impact loan performance and profitability.