For decades, banks and credit unions have organized their products, underwriting, and service models around a single assumption: income is predictable, consistent, and comes from one employer. But the U.S. economy has changed faster than the banking system that serves it.
Today, more than 70 million Americans earn income outside of a traditional job — freelancing, contracting, consulting, creating, caregiving, designing, building, trading, or driving. Millions of them earn six figures. And yet, most banks still treat them as anomalies rather than opportunities.
This is the most overlooked growth market in banking. And intelligent banks & credit unions will be the ones who move first.
A New Majority, not a Side Hustle
The independent workforce has nearly doubled in the past decade. It now includes designers, software developers, content creators, Etsy sellers, licensed tradespeople, travel nurses, real estate photographers, fractional CFOs, and even Uber drivers. According to MBO Partners, more than 5.6 million independent workers now earn over $100,000 a year, and freelancers contributed over $1.27 trillion to the economy last year.
For younger generations, diversified income is becoming the new normal and has helped to reshape how financial institutions must think about stability and growth. Over half of Gen Z adults already earn income outside of a traditional employer. They do not expect a single career at a single company. They wish to combine passions, contracts, digital platforms, and entrepreneurship.
And they expect their bank to understand that.
They want Intelligent Banking — experiences that anticipate their needs, adapt to their cash flow, and every interaction is more intelligent because of the use of data.
Why Banks & Credit Unions Are Falling Behind
The problem is not intent — banks and credit unions care deeply about serving their communities and growing relationships. The problem is structure.
The financial system is still designed for a world where income comes every other Friday from one employer. Independent workers don’t fit the mold — not because they’re unstable or uncreditworthy, but because their financial lives are dynamic, digital, and decentralized.
They invoice, receive deposits through Stripe, Etsy, Square, DoorDash, or corporate ACH, and set aside savings for slow seasons. They pay quarterly taxes. Some operate as single-member LLCs. Though many have strong cash flow and good money habits, they still get denied loans, delayed access to funds, or pushed into generic consumer accounts with none of the tools they actually need.
They aren’t "unbanked." They’re "poorly banked," and that’s a problem to be solved.
Three Outdated Practices:
1. Underwriting is built for employment, not income.
Traditional credit models look for W-2 income, employer tenure, and salary consistency. Gig workers have diversified income sources, seasonal patterns, and no HR department to verify employment. The result? They are frequently denied credit or offered worse rates, even when their cash flow proves they can repay debt.
2. Banking products don’t match how they operate.
Most independent workers don’t need a corporate treasury account — but they do need better than a basic checking account. They want an experience that bundles tools that send invoices, receive payments instantly, set aside taxes automatically, issue virtual cards for tools or fuel, and keep track of deductible expenses.
3. Banks & Credit Unions don’t recognize them in their own customer base.
Banks & Credit Unions already have thousands of independent workers in their customer base. Transaction data shows PayPal deposits, Shopify payouts, Uber transfers, Venmo business payments, and quarterly tax bills. The bank should be using this data to segment, personalize, and engage customers with relevant products and proactive offers.
Intelligent Banking: A Fast Fix
Successfully serving in this market doesn’t require a core or a multi-year transformation. It requires two major shifts: a new underwriting approach and a new set of account features.
Intelligent Banking connects data across income streams, interprets cash flow patterns, and adapts experiences accordingly. It means products learn, and underwriting evolves from a "Where do you work?" mentality to a "Is your income stable and diversified enough to repay?" mentality.
This means evaluating:
- 12 to 24 months of income deposits (not just the last paycheck)
- Number of paying clients or platforms (payer diversity)
- Expense-to-income ratios
- Cash reserves and tax set-aside behavior
- Seasonality — and whether it’s predictable or declining
- LLC history, platform tenure, even customer reviews (if shared and permitted)
This is not lowering standards. It is measuring risk the way small businesses are measured — by cash flow and resilience.
The product set needs to match how independent workers actually live. As such, a winning "Independent Business Account" with intelligence should include:
- Instant payout/earnings access (RTP/FedNow, not 2-day ACH holds)
- Built-in invoicing and digital payment acceptance
- Automatic tax withholding buckets (e.g., 25—30% of income)
- Virtual cards with spending controls by category (fuel, tools, ads)
- Expense categorization and end-of-year 1099-ready exports
- Optional credit lines based on cash flow, not job title
- Smart nudges ("You earned $4,000 this week — want to move $1,000 to taxes?")
These aren’t just convenience features — they are contextual intelligence features for banks that think ahead. And the features for the new class of entrepreneurs.
The Moment Is Now
Banks and credit unions are competing for deposits, younger relationships, loan volume, and community relevance. The independent economy represents all four.
At Candescent, we help financial institutions turn Intelligent Banking from a concept into a capability—unifying data, AI, and cloud technology to help banks identify and serve independent earners with faster underwriting, smarter product bundles, and more connected experiences.
The question isn’t whether the market will grow, as it already has. The question is which institutions, and their technology partners, will evolve fast enough to capture it.
By John Garvey, Chief Operating Officer at Candescent
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