What changed in this filing

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Item 1A. Risk Factors

2025-02-24 compared with 2024-02-27 · 457 added, 476 removed, 1167 unchanged (44% of the section changed)

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Business, Financial and Operational Risks

• our ability to successfully identify and address the risks and uncertainties we face;

• demands on our resources, intense and increasing competition, and the success of our business model (including continuing profitability);

• our ability to successfully identify and address the risks and uncertainties we face, particularly with respect to certain rapidly evolving industries;

• demands on our resources, intense and increasing competition, and the success of our business model;

• legislative and regulatory policies and related actions that apply or may apply to us, particularly as a result of our operating a bank and as a bank holding company, in connection with student loans, given our brokerage and investment advisory activity, or related to services provided by our technology platform;

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• adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults, or non-performance by financial institutions or transactional counterparties;

• impact of macroeconomic factors, including regulatory responses, elevated and fluctuating inflation, increased delinquency rates on consumer debt, reduced consumer discretionary spending and economic uncertainty;

• uncertainty of macroeconomic conditions and the impact of macroeconomic factors, including changes in governmental policy, regulatory responses, applicable laws and regulations, fluctuating inflation and interest rates, delinquency rates on consumer debt, changes in consumer discretionary spending and economic uncertainty;

• failure of third-party service providers or systems on which we rely or, in the event we move certain services or systems in-house, our ability to successfully perform those services or implement and operate those systems;

Risks Related to Market and Interest Rates

• cost and availability of funding in the capital markets and fluctuations in interest rates;

• higher than expected payment speeds of loans or longer holding periods of loans could negatively impact our returns as the holder of the residual interests in securitization trusts;

• decreased demand for certain lending products in the face of high interest rates, such as student loans and home loans;

• cost and availability of funding in the capital markets and fluctuations in interest rates could impact our ability to operate our business;

• higher than expected payment rates of loans have in the past and could in the future negatively impact our returns as the holder of the residual interests in securitization trusts;

• decreased demand for certain lending products due to changes in interest rates, such as student loans and home loans, could negatively impact our results of operations;

• an inability to maintain a competitive annual percentage yield on deposits could cause members to transfer checking and savings account balances to our competitors;

Risks Related to Strategic and New Products

• potential and past acquisitions that require significant attention and could disrupt our business and adversely affect our financials;

• our failure to innovate or respond to evolving technological or other changes;

• an increase in fraudulent activity, particularly in connection with our personal loans product, credit card and SoFi Money;

• potential and past acquisitions that require significant attention could disrupt our business and adversely affect our financials;

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• increased business, economic and regulatory risks from continued expansion abroad, given our brokerage and investment advisory activity, or related to services provided by our technology platform;

• we may fail to innovate or respond to evolving technological or other changes;

• we may experience an increase in fraudulent activity, particularly in connection with our personal loans product, credit card and SoFi Money;

• inability to increase fee-based, capital-light revenue sources and continue to expand our Loan Platform Business;

• we are subject to increased business, economic and regulatory risks from continued expansion abroad, given our brokerage and investment advisory activity, or related to services provided by our technology platform;

Credit Market Related Risks

• worsening economic conditions, including general economic uncertainty, elevated and fluctuating inflation and interest rates, market volatility, the cyclical nature of our industry, and our ability to maintain expected levels of liquidity;

• we could be adversely impacted by worsening economic conditions, including general economic uncertainty, fluctuating inflation and interest rates, market volatility, the cyclical nature of our industry, and our ability to maintain expected levels of liquidity;

• our inability to make accurate credit and pricing decisions or effectively forecast our loss rates;

• the discharge of qualified student loans in bankruptcy in certain circumstances;

• the failure of our third-party service providers to perform various functions related to the origination and servicing of loans;

• financial issues or liquidity issues experienced by our technology platform clients that could result in termination of, or inability to pay for, their services;

• the failure of our third-party service providers to perform functions related to the origination and servicing of loans;

• financial issues or liquidity issues experienced by our technology platform clients could result in termination of, or inability to pay for, their services;

Risks Related to Funding and Liquidity

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Regulatory, Tax and Other Legal Risks

• our exposure to evolving laws, rules, regulations and government enforcement policies, federal or state loan forgiveness programs, expansion of the federal student loan income-driven repayment plan, and potential enforcement actions, litigation, investigations, exams or inquiries or impairment of licenses;

• our exposure to evolving laws, rules, regulations and government enforcement policies, and potential enforcement actions, litigation, investigations, exams or inquiries or impairment of licenses;

• our ability to effectively mitigate risk exposure;

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• the loss of key management members or key employees, or an inability to hire key personnel;

• increased business continuity and cyber risks due to our hybrid workforce;

• natural disasters, power outages, telecommunications failures, man-made problems and similar events;

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• regulatory obligations as a result of our business combination with a special purpose acquisition company that may impact us differently than other publicly traded companies;

• incorrect estimates or assumptions by management in connection with the preparation of our financial statements;

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• cyberattacks and other security breaches or disruptions of our systems or third-party systems on which we rely, including our cloud computing services arrangement, disruptions that may impact our ability to collect loan payments and maintain accurate accounts, or our ability to provide services to our technology platform clients;

• liabilities related to the collection, processing, use, storage and transmission of personal data;

• technology challenges related to the collection, processing, use, storage and transmission of personal data;

• liabilities related to the data, models, and use of artificial intelligence in products or business processes;

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We operate in rapidly evolving industries and have limited experience in parts of our Financial Services and Technology Platform segments, which may make it difficult for us to successfully identify and address the risks and uncertainties we face.

We operate in rapidly evolving industries which may make it difficult to quickly identify risks to our business and evaluate our future prospects.

In addition, in recent years, we have rapidly expanded our operations to include or expand, among other things, deposit accounts, credit cards, investment services, technology solutions, home loan originations, and international operations, and we have limited experience in these areas.

We operate in rapidly evolving industries which may make it difficult to successfully identify risks to our business and evaluate our future prospects.

In addition, in recent years, we have rapidly expanded our operations to include or expand, among other things, deposit accounts, credit cards, investment services, technology solutions, home loan originations, small business financing solutions, loan platform business solutions, alternative investments, and international operations, and we have limited experience in these areas.

In the first quarter of 2022, we acquired a bank charter and face risks as a result of our lack of experience operating a bank and as a bank holding company.

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In 2023, we acquired Wyndham, a fintech mortgage lender, which expanded our home loan business.

In addition to the recent events above, we face numerous challenges to our success, including our ability to:

In 2024, we adopted our Technology Platform’s Cyberbank Core in connection with the launch of a commercial payment services sponsor bank program.

In addition to the events above, we face numerous challenges to our success, including our ability to:

• increase or maintain the number, volume and types of, and add new features to, the loans we extend to our members as the market for loans evolves and as we face new and increasing competitive threats;

• successfully integrate our past and future acquisitions, including continuing to integrate Wyndham’s technology and employees, performing functions in home loans origination, such as home loans processing and underwriting, which we have not previously performed, and managing the origination of new home loan types;

• successfully integrate our past and future acquisitions, including continuing to develop Wyndham’s technology, performing functions in home loans origination, such as home loans processing and underwriting, and managing the origination of new home loan types;

• increase the number of members utilizing our non-lending products, including our direct deposit feature, and maintain and build on the loyalty of existing members by increasing their use of new or additional products;

• continue to increase our fee-based revenue within our Loan Platform Business, including fees earned for originating loans on behalf of third-party partners and fees earned for referring loans to be originated by third party partners;

• successfully maintain and enhance our diversified funding strategy, including through deposits, securitization financing from consolidated and nonconsolidated VIEs, whole loan sales, and debt warehouse facilities;

• further establish, diversify and refine our checking and savings, investment and brokerage offerings to meet evolving consumer needs and preferences;

• further establish, diversify and refine our checking and savings, credit card, investment and brokerage offerings to meet evolving consumer needs and preferences;

• offer an attractive annual percentage yield on our deposits compared to our competitors and manage deposit costs;

• diversify our revenue streams across our products and services;

• favorably compete with other companies and banks, including traditional and alternative technology-enabled lenders, financial service providers, broker-dealers, and technology platform as a service providers;

• continue to realize the benefits of operating a bank;

• favorably compete as a service provider with other companies and banks, including traditional and alternative technology-enabled lenders, financial service providers, broker-dealers, social media and other commerce platforms and applications that offer peer-to-peer, in-app and social commerce payment capabilities, and technology platform;

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• introduce new products or other offerings, as well as new or improved technologies, to meet the needs of our existing and prospective members or to keep pace with competitive lending, checking and savings, investment, technology and other developments;

• continue to realize the benefits of operating a bank;

• maintain or increase the effectiveness of our direct marketing and other sales and marketing efforts, and maintain our brand;

• successfully design, develop, integrate, operate and maintain technology systems at scale and with a high degree of reliability that support our member growth and product adoption;

• successfully navigate economic conditions and fluctuations in the credit markets, including elevated and fluctuating inflation, interest rates that are higher than those in the recent past, recessionary pressures and economic uncertainty;

• successfully navigate economic conditions and fluctuations in the credit markets, including fluctuating inflation and interest rates, and economic uncertainty;

• continue to add new clients and new products to existing clients in our technology platform as a service business;

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• successfully identify a slowdown or acceleration in the business growth of our technology platform clients to ensure aligned costs and capabilities;

• successfully navigate the evolving regulatory environment for technology platform-as-a-service providers;

• successfully navigate the evolving regulatory environment for a technology platform as a service provider;

• establish fraud prevention strategies that proactively identify threat vectors and mitigate losses;

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• successfully continue to expand internationally;

• adequately respond to macroeconomic and other exogenous challenges, including continued government efforts to curb inflation, which may impact the overall economy and affect demand for our products and services, market volatility, particularly in the financial services industry, changes in consumer confidence, consumer discretionary spending and loan delinquency rates, pandemics or other health-related crises, the war between Israel and Hamas, and the ongoing war in Ukraine;

• adequately respond to macroeconomic and other exogenous challenges, including fluctuating interest rates, market volatility, particularly in the financial services industry, changes in consumer confidence, consumer discretionary spending and loan delinquency rates, pandemics or other health-related crises, escalating conflict in the Middle East, the ongoing war in Ukraine, and significant changes related to governmental policy, rules and regulations or executive actions;

• maintain successful relationships with our governmental regulatory agencies and law enforcement authorities, as well as self-regulatory agencies;

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We have a history of net losses prior to the fourth quarter of 2023.

We may incur net losses in the future, and such losses may fluctuate significantly from quarter to quarter.

We will need to generate and sustain significant revenues for our business generally, and achieve greater scale and generate greater operating cash flows from our Financial Services segment, in particular, in future periods, as well as successfully navigate the macroeconomic environment, in order to maintain or increase our level of profitability.

We intend to continue to invest in sales and marketing, technology, and products and services in order to enhance our brand recognition and our value proposition to our members, prospective members and clients in our technology platform business, and these additional costs will create further challenges to maintaining or increasing near-term profitability.

Our general and administrative expenses have in the past and may in the future increase to meet the increased compliance and other requirements associated with operating as a public company and a bank holding company, operating a bank, and evolving regulatory requirements.

See “ Regulatory, Tax and Other Legal Risks — As a bank holding company, we are subject to extensive supervision and regulation, and changes in laws and regulations applicable to bank holding companies could limit or restrict our activities and could have a material adverse effect on our operations ”.

We may incur net losses in the future, and any such losses may fluctuate significantly from quarter to quarter.

We will need to continue to generate and sustain significant revenues for our business generally and achieve greater scale and generate increasing operating cash flows from our Financial Services segment, in particular, in future periods, as well as successfully navigate the macroeconomic environment, in order to maintain or increase our level of profitability.

We intend to continue to invest in new products and businesses, which has in the past and may in the future cause us to fund and operate aspects of our business at a loss.

We also intend to continue to invest in sales and marketing, technology, and additional products and services in order to enhance our brand, our brand recognition and our value proposition to our members, prospective members and clients in our technology platform business, and these additional costs will create further challenges to maintaining or increasing near-term profitability.

See “ Regulatory, Tax and Other Legal Risks — As a bank holding company, we are subject to extensive supervision and

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and, with respect to our Technology Platform segment, adoption by clients of additional platform as a service offerings.

regulation, and changes in laws and regulations applicable to bank holding companies could limit or restrict our activities and could have a material adverse effect on our operations ”.

We are continuously refining our revenue and business model, which is premised on creating a virtuous cycle for our members to engage with more products across our platform, a strategy we refer to as the Financial Services Productivity Loop, and, with respect to our Technology Platform segment, adoption by clients of additional platform as a service offerings.

There is no assurance that our revenue and business model, or any changes to our revenue and business model to better position us with respect to our competitors, will be successful.

Our efforts to grow our business may be more costly than we expect, and we may not be able to maintain or increase our revenue sufficiently to offset our higher operating expenses.

We may incur losses and we may be unable to maintain profitability, for a number of reasons, including the risks described in this Annual Report on Form 10-K, unforeseen expenses, difficulties, complications and delays, differences between our assumptions and estimates and results, the effects of macroeconomic conditions and other unknown events.

We have experienced rapid growth in recent years, including through the addition of new products and lines of business and into new geographies, which may place significant demands on our operational, risk management, sales and marketing, technology, compliance, and finance and accounting resources.

Our efforts to continue to grow our business may be more costly than we expect, and we may not be able to maintain or increase our revenue sufficiently to offset our higher operating expenses.

We may incur future losses and we may be unable to maintain profitability, for a number of reasons, including the risks described in this Annual Report on Form 10-K, unforeseen expenses, difficulties, complications and delays, differences between our assumptions and estimates and results, the effects of macroeconomic conditions and other unknown events.

We have experienced rapid growth in recent years, including through the addition of new products and lines of business and entry into new geographies, which may place significant demands on our operational, risk management, sales and marketing, technology, compliance, and finance and accounting resources.

Our rapid growth in certain areas of our business in recent years, primarily within our Financial Services and Technology Platform segments, as well as operating a bank and as a bank holding company, has placed significant demands on our operational, risk management, sales and marketing, technology, compliance, and finance and accounting infrastructure, and has resulted in increased expenses, a trend that we expect to continue as our business grows.

In addition, we are required to continuously develop and adapt our systems and infrastructure in response to the increasing sophistication of the consumer financial services market, changing technologies, evolving fraud, privacy and information security landscape, and regulatory developments, both domestically and internationally, relating to our existing and projected business activities.

Our future growth will depend on, among other things, our ability to maintain an operating platform and management system able to address such growth, our ability to grow and optimize deposit balances, and our ongoing ability to demonstrate to our regulators that our risk management and compliance practices are growing in a commensurate fashion, all of which has required and we expect will continue to require us to incur significant additional expenses, expand our workforce and commit additional time from senior management and operational resources.

Our future growth will depend on, among other things, our ability to maintain an operating platform and management system able to address such growth, our ability to grow and optimize deposit balances, and our ongoing ability to demonstrate to our regulators that our risk management and compliance practices are growing and evolving in a commensurate fashion, all of which has required, and we expect will continue to require, us to incur significant additional expenses, expand our workforce and commit additional time from senior management and operational resources.

We may not be able to manage supporting and expanding our operations effectively, and any failure to do so would adversely affect our ability to increase the scale of our business, generate projected revenue and control expenses.

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• the continued growth and engagement of our member base;

• our ability to monetize our member base, including through the use of additional products by our existing members;

• our ability to further monetize our member base, including through the use of additional products by our existing members;

• our ability to acquire members at a lower cost;

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Additionally, when new competitors seek to enter our markets, or when existing market participants seek to increase their market share, these competitors sometimes undercut, or otherwise exert pressure on, the pricing terms prevalent in that market, which could adversely affect our market share and/or our ability to capitalize on market opportunities.

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We currently compete at multiple levels with a variety of competitors, including:

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• banks and other financial institutions, with respect to our checking and savings accounts;

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• rewards credit cards provided by other financial institutions, with respect to our SoFi Credit Card;

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• other mortgage lenders, including fintech-focused lenders, and other companies for our home loans;

• social media and other commerce platforms and applications that offer peer-to-peer, in-app and social commerce payment capabilities;

• other technology platforms with respect to the enterprise services we provide, such as technology products and solutions via Galileo and Technisys;

• other content providers for subscribers to our financial services content, including content from alternative providers available to our subscribers through our Lantern Credit service, which is a financial services aggregator providing marketplace lending products, and various enterprise partnerships;

• other content providers for subscribers to our financial services content, including content from alternative providers available to our subscribers through our Lantern service, which is a financial services aggregator providing marketplace lending products, and various enterprise partnerships;

• other financial services firms offering employers a comprehensive platform for employees to build financial well-being through student loan and 529 educational plan contributions, educational tools, and financial resources, all of which we provide through SoFi At Work.

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• selling, marketing and promotional efforts;

• our ability to continue to expand the Loan Platform Business with existing and new loan origination partners;

• our ability to continue to increase our fee-based revenue and diversify our revenue base;

• our ability to compete on price, particularly with respect to SoFi Invest and the Technology Platform where demand for our products and services may be affected if we are unable to compete with other brokerages or technology-as-a-service providers on price;

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• general market conditions and their impact on our liquidity and ability to access funding;

• the impact of macroeconomic conditions, including the impacts from current efforts to curb inflation, stock market volatility, changes in consumer confidence, consumer discretionary spending, and any changes in loan default rates, and related developments on the lending and financial services markets we serve;

• the impact of macroeconomic conditions, including changes in interest rates, stock market volatility, changes in consumer confidence, consumer discretionary spending, and any changes in loan default rates, and related developments on the lending and financial services markets we serve;

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• our brand strength relative to our competitors.

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All of the foregoing factors and events could adversely affect our business, financial condition, results of operations, cash flows and future prospects.

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Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults, or non-performance by financial institutions or transactional counterparties, could adversely affect our financial condition and results of operations.

Actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems and adversely affect our financial condition and results of operations.

For example, Silicon Valley Bank and Signature Bank were put into FDIC receivership in March 2023 and First Republic Bank was put into FDIC receivership in May 2023.

These market developments have negatively impacted customer confidence in the safety and soundness of certain banks.

As a result, although we have not observed a decline in our deposits to date, our members may choose to maintain deposits with other financial institutions or spread their deposit funds among multiple financial institutions.

The closure of financial institutions, even if such financial institutions are unrelated to our business, may result in a deterioration of consumer confidence in banks and the banking system more broadly as well as declines in the price of our stock or reluctance of our members to use our products and services.

Inflation and rapid increases in interest rates have led to a decline in the trading value of previously issued government securities with interest rates below current market interest rates.

On March 12, 2023, the Federal Reserve announced the creation of the Bank Term Funding Program, a new emergency lending program for FDIC-insured banks, as well as certain U.S.

branches and agencies of foreign banks.

Under the Bank Term Funding Program, the Treasury Department provided $25 billion of credit protection to the Federal Reserve Banks, in order to provide loans with terms up to one year secured by certain government securities held by eligible financial institution borrowers.

The program was established to reduce the need for eligible borrowers to sell the securities in times of stress, thus, mitigating the risk of potential losses on the sale of such securities.

On January 24, 2024, the Federal Reserve announced that the program would cease making new loans, as scheduled, on March 11, 2024.

There is no guarantee that the Federal Reserve would establish a similar facility in the future or that the Treasury, FDIC and Federal Reserve will provide access to uninsured funds in the event of the closure of other banks or financial institutions, or that they would do so in a timely fashion.

It is likely that, if the banking sector deteriorates, the U.S.

and/or other global economies would be adversely affected, including facing the possibility of a recession, the duration and severity of which is difficult to predict.

These developments may adversely affect our business, financial condition and results of operations.

Increased market volatility and adverse changes in financial market conditions may increase our market risk.

Our liquidity, competitive position, business, results of operations and financial condition are affected by market risks such as changes in interest rates, fluctuations in equity, commodity and futures prices, the implied volatility of interest rates and credit spreads and other economic and business factors.

These market risks may adversely affect, among other things, the value of our securities, the cost of debt capital and our access to credit markets, customer allocation of capital among investment alternatives, and our competitiveness with respect to deposit pricing, and may negatively impact customer confidence in the safety and soundness of banks.

In times of market stress or other unforeseen circumstances, previously uncorrelated indicators may become correlated, which may limit the effectiveness of our strategies to manage these risks.

Our future growth depends significantly on our branding and marketing efforts, and if our marketing efforts are not successful or we receive negative publicity, our business and results of operations will be harmed.

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Our ability to compete for, attract and maintain members, lending counterparties, marketing partners and other partners relies to a large extent on their trust in our business, our reputation and the value of our brand.

While our goal remains to increase the strength, recognition and trust in our brand by increasing our member base and expanding our products and services, if any of our current marketing channels becomes less effective, if regulatory requirements, including the FDIC’s advertising rules, restrict or diminish our ability to use these channels, if we are unable to continue to use any of these channels, if we receive negative publicity or fail to maintain our brand, if the cost of using these channels significantly increases or if we are not successful in generating new channels, we may not be able to attract new members or increase the activity of our existing members on our platform in a cost-effective manner.

While our goal remains to increase the strength, recognition and trust in our brand by increasing our member base and expanding our products and services, if any of our current marketing channels becomes less effective, if regulatory requirements, including the CFPB and FDIC’s advertising rules, restrict or diminish our ability to use these channels, if we are unable to continue to use any of these channels, if we receive negative publicity or fail to maintain our brand, if the cost of using these channels significantly increases or if we are not successful in generating new channels, we may not be able to attract new members or increase the activity of our existing members on our platform in a cost-effective manner.

For example, in February 2024, the CFPB released a Consumer Financial Protection Circular, warning digital comparison-shopping tool operators and lead generators that marketing practices that take unreasonable advantage of a consumer’s reasonable reliance on the operator or lead generator to act in the consumer’s interests may violate the CFPA prohibition on abusive acts or practices.

Such unreasonable advantage can include distorting the shopping experience for a consumer financial product or service by giving preferential treatment to an operator or lead generator’s own or other products or services through steering or enhanced product placement, for financial or other benefits.

If we are unable to recover our marketing costs through increases in the size, value or the overall number of loans we originate, or member selection and utilization of other SoFi products such as SoFi Money, SoFi Invest and SoFi Credit Card, it could have a material adverse effect on our business, financial condition, results of operations, cash flows and future prospects.

In addition, negative publicity can adversely affect our reputation and damage our brand, and may arise from many sources, including actual or alleged misconduct, errors or improper business practices by employees, employee claims of discrimination or harassment, product failures, existing or future litigation or regulatory actions, inadequate protection of consumer information by us or our third-party service providers, data breaches, matters related to or affecting our financial reporting or compliance with SEC and Nasdaq listing requirements and media coverage, whether accurate or not.

Negative publicity or allegations could reduce demand for our products, result in a decrease in the price of our stock, undermine the loyalty of our members and the confidence of our lending counterparties and technology platform clients, impact our partnerships, reduce our ability to recruit and retain employees or lead to greater regulatory scrutiny, all of which could lead to the attrition of our members, lending

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counterparties, technology platform clients and harm our results of operations.

In addition, we and our officers, directors and/or employees have been, and may in the future be, named or otherwise involved in litigation or claims, including employment-related claims such as workplace discrimination or harassment, which could result in negative publicity and/or adversely impact our business, even if we are ultimately successful in defending against or litigating such claims.

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Reputational harm, including as a result of our actual or alleged conduct or public opinion of the financial services industry generally, could adversely affect our business, results of operations, and financial condition.

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Moreover, negative public opinion has in the past and could in the future result from actions by the financial services industry generally, including due to the failure of one or more additional banks, or by certain members or individuals in the industry and can adversely affect our reputation with no actual or alleged actions on our part.

For example, public opinion of the financial services industry was negatively impacted following the closure of Silicon Valley Bank and generally resulted in decreases in the stock prices of financial services companies.

For example, public opinion of the financial services industry was negatively impacted following the 2023 closures of Silicon Valley Bank, Signature Bank, and First Republic Bank and generally resulted in decreases in the stock prices of financial services companies.

Negative public opinion could result from our actual or alleged conduct in any number of activities, including sales and marketing practices;

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Our reputation and/or business could be negatively impacted by ESG matters and/or our reporting of such matters.

There is an increasing focus from regulators, certain investors, and other stakeholders concerning ESG matters, both in the United States and internationally.

We communicate certain ESG-related initiatives and/or commitments regarding our employees, diversity, equity and inclusion goals, and other matters in our ESG Report, on our website, in our filings with the SEC, and elsewhere.

We communicate certain ESG-related initiatives regarding our employees, climate-related commitments and goals, and other matters in our ESG Report, on our website, in our filings with the SEC, and elsewhere.

These initiatives and commitments could be difficult to achieve and costly to implement.

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In addition, we could be criticized for the timing, scope or nature of these initiatives, goals, or commitments, or for any revisions to them.

To the extent that our required and voluntary disclosures about ESG matters increase, we could be criticized for the accuracy, adequacy, or completeness of such disclosures.

Our actual or perceived failure to achieve our ESG-related initiatives, goals, or commitments could negatively impact our reputation, result in ESG-focused investors not purchasing and holding our stock, or otherwise materially harm our business.

To the extent that our required and voluntary disclosures about ESG matters change, we could be criticized for the accuracy, adequacy, or completeness of such disclosures.

Our actual or perceived failure with respect to our ESG-related initiatives, goals, or commitments could negatively impact our reputation, result in ESG-focused investors not purchasing and holding our stock, or otherwise materially harm our business.

We may be unable to satisfactorily meet evolving standards, regulations and disclosure requirements related to ESG.

For example, a number of state legislators and regulators have adopted or are currently considering proposing or adopting other rules, regulations, directives, initiatives and laws requiring ESG-related disclosures or conduct, including California laws S.B.

The adoption of these and similar laws could require us to, among other things, expend material capital resources in connection with such compliance efforts.

Furthermore, there continues to be a lack of consistent proposed climate change and ESG-related legislation and guidance, which creates regulatory and economic uncertainty.

Such matters can affect the willingness or ability of investors to make an investment in our Company, as well as our ability to meet regulatory requirements.

Any failure, or perceived failure, to meet evolving regulations and industry standards could have an adverse effect on us.

In addition, in recent years “anti-ESG” sentiment has gained momentum across the U.S., with several states and Congress having proposed or enacted “anti-ESG” policies, legislation, or initiatives or issued related legal opinions, and President Trump having recently issued an executive order discouraging diversity equity and inclusion (“DEI”) initiatives in the private sector.

Such anti-ESG and anti-DEI-related policies, legislation, initiatives, litigation, legal opinions, and scrutiny could result in volatility of our stock price and the Company facing additional compliance obligations, becoming the subject of investigations and enforcement actions, or sustaining reputational harm.

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We may experience fluctuations in our quarterly operating results.

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In light of these factors, results for any period should not be relied upon as being indicative of performance in future periods.

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We sell our loans to a concentrated number of whole loan purchasers and the loss of one or more significant purchasers could have a negative impact on our operating results.

Although we have begun to hold loans on-balance sheet for longer periods, when we sell our personal loans, student loans and home loans, we sell to a concentrated number of whole loan purchasers.

Although we continue to hold loans on-balance sheet for longer periods, when we sell our personal loans, student loans and home loans, we sell to a concentrated number of whole loan purchasers.

There are inherent risks whenever a large percentage of a business is concentrated with a limited number of parties.

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We rely on certain third-party computer systems or third-party service providers, including cloud technology providers such as AWS, internet service providers, payment services providers, market and third-party data providers, regulatory and compliance services providers, clearing systems, market makers, exchange systems, banking technology systems, co-location facilities, communications facilities and other facilities to run our platform, facilitate trades by our members and support or carry out certain functions.

For example, to provide our checking and savings account, cash management account, credit card and other products and services, we rely on third parties that we do not control, such as payment card networks, our acquiring and issuing processors, payment card issuers, various financial institution partners, systems like the ACH, and other partners.

For example, to provide our checking and savings account, cash management account, credit cards and other products and services, we rely on third parties that we do not control, such as payment card networks, our acquiring and issuing processors, payment card issuers, various financial institution partners, systems like the ACH, and other partners.

We rely on these third parties for a variety of services, including the transmission of transaction data, processing of chargebacks and refunds, settlement of funds, and the provision of information and other elements of our services.

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Any interruption in these third-party services, or deterioration in the quality of their service or performance, could be disruptive to our business.

Furthermore, third parties may rely on artificial intelligence or machine learning for the services they provide us and, given that the regulatory framework relating to the use of machine learning and artificial services in the provision of financial services is still developing, the third parties’ use of such technologies may impact their ability to carry out certain functions or impact the quality of their service or performance.

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parties’ use of such technologies may impact their ability to carry out certain functions or impact the quality of their service or performance.

Because we are a bank holding company subject to regulation, supervision and examination by the Federal Reserve, and because SoFi Bank is subject to regulation, supervision and examination by the OCC and the FDIC, and SoFi Bank and its affiliates are subject to regulations issued by the CFPB, our and SoFi Bank’s oversight of third-party service providers is also subject to regulatory oversight.

In 2024, the Federal Reserve, OCC and FDIC increased their focus on regulating banks’ relationships and oversight over third-party service providers.

For example, these agencies published interagency guidance and a joint statement on banks’ vendor management practices and arrangements with third parties to deliver bank products and services in May 2024 and July 2024, respectively, and these and other regulatory authorities continued to scrutinize and take enforcement actions against banks and their business partners for insufficient third-party management programs in 2024.

In addition, because Galileo provides technology services to SoFi Bank, we are subject to additional regulatory scrutiny under Regulation W which requires, among other things, that arrangements between a bank and its affiliates are on market terms.

If a regulatory authority found our or SoFi Bank’s service provider oversight to be lacking, the regulatory authority could require that we or SoFi Bank implement corrective action, including limiting or terminating certain relationships with service providers, which could be costly and disruptive to our business.

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Further, we may, from time to time, decide to modify or terminate relationships with third-party service providers and to perform certain functions and/or services internally.

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Additionally, the migration of any such functions and/or services may introduce additional risks and could cause disruption to our business.

Our third-party service providers are susceptible to operational, technological and security vulnerabilities, including security breaches, which may impact our business, and our ability to monitor our third-party service providers’ data security is limited.

Our third-party service providers are susceptible to operational, technological and security vulnerabilities, including security incidents and breaches and outages, which may impact our business, and our ability to monitor our third-party service providers’ data security is limited.

In addition, these third-party service providers may rely on subcontractors to provide services to us that face similar risks.

Failures or security breaches by or of our third-party service providers or their subcontractors that result in an interruption in service, unauthorized access, misuse, loss or destruction of data or other similar occurrences could interrupt our business, have in the past and could in the future cause us to incur losses, result in decreased member or client satisfaction and increase member or client attrition, subject us to member or client complaints, significant fines, litigation, disputes, claims, regulatory investigations or other inquiries and harm our reputation.

Failures or security incidents or breaches by or of our third-party service providers or their subcontractors that result in an interruption in service, unauthorized access, misuse, loss or destruction of data or other similar occurrences could interrupt our business, have in the past and could in the future cause us to incur losses, result in decreased member or client satisfaction and increase member or client attrition, subject us to member or client complaints, significant fines, litigation, disputes, claims, regulatory investigations or other inquiries and harm our reputation.

Through contractual provisions and third-party risk management processes, we take steps to require that our providers, and their subcontractors, protect our data and information, including personal data.

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An interruption in or the cessation of service by our third-party service providers or their subcontractors, coupled with our possible inability to make alternative arrangements in a smooth, cost-effective and timely manner, could have adverse effects on our business, financial condition and results of operations.

If a service provider fails to provide the services required or expected, or fails to meet applicable contractual or regulatory requirements such as service levels or compliance with applicable laws, the failure could negatively impact our business.

Certain aspects of the services we provide also rely and depend upon the ability of third parties with whom we do not contract directly to perform specified tasks or execute certain functions.

For example, our customers access trading venues like securities exchanges through third parties like clearing brokers.

If a trading venue experiences a system error and/or a failure of controls, subsequent trades may be impacted, such as trading executed at anomalous pricing.

Similarly, if a trading venue experiences an outage, our customer’s ability to place trades or our ability to effect transactions in securities on behalf of

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customers via our broker-dealer may be impacted.

As a result of these impacts, we might experience customer complaints, loss of revenue or other financial loss, or we may have to respond to regulatory inquiries related to such outages.

If a service provider fails to either provide the services required or expected or meet applicable contractual or regulatory requirements such as service levels or compliance with applicable laws, the failure could negatively impact our business.

Such a failure could also adversely affect the perception of the reliability of our networks and services and the quality of our brand, which could materially adversely affect our business and results of operations.

Further, if there were deficiencies in the oversight and control of our third-party relationships, and if our regulators held us responsible for those deficiencies, it could have an adverse effect on our business, reputation and results of operations.

The conditional conversion feature of the notes, if triggered, may adversely affect our financial condition.

Holders of our convertible notes issued in October 2021 and due in 2026 (the “notes”) may be entitled to convert the notes during specified periods at their option.

If one or more holders elect to convert their notes, we may settle any converted principal through the payment of cash, which could adversely affect our financial results and liquidity and could result in a decline in our stock price.

The conditional conversion feature of our convertible notes, if triggered, may adversely affect our financial condition.

Holders of our convertible notes issued in October 2021 and due in 2026 and our convertible notes issued in March 2024 and due in 2029 (collectively, the “notes”) may be entitled to convert the notes during specified periods at their option.

If one or more holders elect to convert their notes, we may settle converted principal through the payment of cash and/or shares of common stock, which could adversely affect our financial results and liquidity and could result in a decline in our stock price.

The Capped Call Transactions may affect the value of the notes and our common stock.

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The Capped Call Transactions are expected generally to reduce the potential dilutive effect on our common stock upon any conversion of the notes and/or offset any potential cash payments we are required to make in excess of the principal amount of converted notes, as the case may be, with such reduction and/or offset subject to a cap.

In connection with establishing their initial hedges of the Capped Call Transactions, the Capped Call Counterparties or their respective affiliates entered into various derivative

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transactions with respect to our common stock and/or purchased shares of our common stock concurrently with or shortly after the pricing of the notes.

In connection with establishing their initial hedges of the Capped Call Transactions, the Capped Call Counterparties or their respective affiliates entered into various derivative transactions with respect to our common stock and/or purchased shares of our common stock concurrently with or shortly after the pricing of the notes.

In addition, the Capped Call Counterparties and/or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions following the pricing of the notes and from time to time prior to the maturity of the notes (and are likely to do so following any conversion of the notes, any repurchase of the notes by us on any fundamental change repurchase date, any redemption date or any other date on which the notes are retired by us, in each case if we exercise the relevant election to terminate the corresponding portion of the Capped Call Transactions).

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Accordingly, these transactions may not operate as we intend if we are required to adjust their terms as a result of transactions in the future or upon unanticipated developments that may adversely affect the functioning of the Capped Call Transactions.

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Market and Interest Rate Risks

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In particular, markets in the U.S.

or abroad have been and may in the future be affected by the level and volatility of interest rates, availability and market conditions of financing, recessionary pressures, inflation and hyperinflation, supply chain disruptions, changes in consumer spending, employment levels, labor shortages, federal government shutdowns, developments related to the U.S.

or abroad have been and may in the future be affected by the level and volatility of interest rates, availability and market conditions of financing, recessionary pressures, inflation and hyperinflation, supply chain disruptions, changes in consumer spending, employment levels, labor shortages, changes to fiscal policy, including expansion of U.S.

federal deficit spending and resultant debt issuance, federal government shutdowns, developments related to the U.S.

federal debt ceiling, changes in legislation, regulations or policy, energy prices, home prices, commercial property values, bankruptcies, a default by a significant market participant or class of counterparties, market volatility, liquidity of the global financial markets, the growth of global trade and commerce, exchange rates, trade policies, the availability and cost of capital and credit, disruption of communication, transportation or energy infrastructure and investor sentiment and confidence.

Additionally, global markets have been and may in the future be adversely affected by the current or anticipated impact of climate change, extreme weather events or natural disasters, the emergence or continuation of widespread health emergencies or pandemics, cyberattacks or campaigns, military conflict, including the war between Israel and Hamas and the ongoing war in Ukraine, terrorism or other geopolitical events which may affect our results of operations.

Additionally, global markets have been and may in the future be adversely affected by the current or anticipated impact of climate change, extreme weather events or natural disasters, the emergence or continuation of widespread health emergencies or pandemics, cyberattacks or campaigns, military conflict (e.g., the escalating conflict in the Middle East and the ongoing war in Ukraine), terrorism or other geopolitical events, including the upcoming changes to the United States presidential administration, which may affect our results of operations.

For example, although we do not have operations in the locations impacted by these conflicts, the ongoing war in these locations has led and could in the future lead to macroeconomic effects, including volatility in commodity prices and the supply of energy resources, instability in financial markets, supply chain interruptions, political and social instability, as well as an increase in cyberattacks and espionage.

Also, any sudden or prolonged market downturn in the U.S.

or abroad, as a result of the above factors or otherwise, could adversely affect our business, results of operations and financial condition, including capital and liquidity

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or abroad, as a result of the above factors or otherwise, could adversely affect our business, results of operations and financial condition, including capital and liquidity levels.

We are not able to predict with any certainty the ultimate impact that any of these events, as well as any other future events, may have on our business.

Significant downturns in the securities markets or in general economic and political conditions may also decrease the demand for our products and services and could also result in our members reducing their engagement with our platform.

Significant downturns in the securities markets or in general economic and political conditions have in the past and may in the future also decrease the demand for our products and services and could in the future result in our members reducing their engagement with our platform.

In addition, such significant downturns may cause default rates on our loans to increase and cause funding and liquidity concerns for our current and prospective technology platform clients reducing their adoption and use of our platform as a service products and services.

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Our business is sensitive to interest rates and interest rates are highly sensitive to many factors that are beyond our control, including global, domestic and local economic conditions and the policies of various governmental and regulatory agencies and, in particular, the Federal Reserve.

The Federal Reserve increased interest rates throughout 2022 and multiple times in 2023, and we are unable to predict whether it will continue to raise rates further.

Further changes to prevailing interest rates could influence not only the interest we receive on loans and investments and the amount of interest we pay on deposits and borrowings, but such changes could also affect (i) our ability to originate loans at competitive rates and obtain deposits;

The Federal Reserve increased interest rates throughout 2022 and 2023 before lowering interest rates in 2024, and we are unable to predict whether interest rates will increase or decrease in the future.

Further changes to prevailing interest rates could influence not only the interest we receive on loans and investments and the amount of interest we pay on deposits and borrowings, but such changes have in the past and could in the future also affect (i) our ability to originate loans at competitive rates and obtain deposits;

(ii) the fair value of our financial assets and liabilities;

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and (v) the competition faced by our SoFi Money deposit product from other investment products which may become more attractive as interest rates rise.

See “ Changing expectations for inflation and deflation and corresponding fluctuations in interest rates could decrease demand for our lending products and negatively affect loan performance, as well as increase certain operating costs, such as employee compensation ” for additional information on the risks of interest rate fluctuations to our business.

Interest rate increases and other actions, including balance sheet management, lending facilities, and the Federal Reserve’s exit from quantitative easing, and similar actions taken by the Federal Reserve or other central banks, are beyond our control and difficult to predict.

See “ Changing expectations for inflation and fluctuations in interest rates could decrease demand for our lending products and negatively affect loan performance, as well as increase certain operating costs, such as employee compensation ” for additional information on the risks of interest rate fluctuations to our business.

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Interest rate changes and other actions, including balance sheet management, lending facilities, and the Federal Reserve’s exit from quantitative easing, and similar actions taken by the Federal Reserve or other central banks, are beyond our control and difficult to predict.

These actions affect interest rates and the value of financial instruments, increase the likelihood of a more volatile market, a further appreciating U.S.

dollar and negative growth in gross domestic product, and affect other assets and liabilities and can impact our members and technology platform clients.

Any such downturn, especially in the regions in which we operate, may adversely affect our asset quality, deposit levels, loan demand and results of operations.

Changes to existing laws, regulations and policies and evolving priorities, including those related to financial regulation, taxation, international trade, fiscal policy, cybersecurity and privacy, digital assets, climate change (including any required reduction of greenhouse gas emissions) and healthcare, may adversely impact U.S.

Any economic downturn, especially in the regions in which we operate, may adversely affect our asset quality, deposit levels, loan demand and results of operations.

Changes or uncertainty with respect to existing laws, regulations and policies, including changes in guidance and interpretation by regulatory authorities, and evolving priorities, including those related to financial regulation, taxation, international trade, fiscal policy, cybersecurity and privacy, digital assets, climate change (including any required reduction of greenhouse gas emissions) and healthcare, may adversely impact U.S.

or global economic activity and our members, our technology platform clients, our counterparties and our earnings and operations.

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Actions taken by other countries, particularly China, to restrict the activities of businesses, could also negatively affect financial markets.

An escalation of tensions, such as a further escalation in conflict in the Middle East in connection with the Israel-Hamas war, could lead to further measures that adversely affect financial markets, disrupt world trade and commerce and lead to trade retaliation, including through the use of duties and tariffs, foreign exchange measures or the large-scale sale of U.S.

An escalation of tensions, such as a trade war between certain countries or a further escalation in conflict in the Middle East, could lead to further measures that adversely affect financial markets, disrupt world trade and commerce and lead to trade retaliation, including through the use of duties and tariffs, foreign exchange measures or the large-scale sale of U.S.

Treasury Bonds.

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In addition to the issuance of equity, historically we have funded our operations and capital expenditures through sales of our loans, secured and unsecured borrowing facilities and securitizations.

We have the option of pursuing a gain-on-sale origination model and, consequently, our earnings and financial condition are largely dependent on the price we can obtain for our products in the capital markets, which has been and may be negatively impacted by interest rates that are higher than those

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in the recent past combined with longer periods during which we have held, and may continue to hold, loans on-balance sheet.

These capital markets risks may be partially mitigated by the availability of bank deposits and other corporate cash (if any) to temporarily hold the loans on our balance sheet.

However, bank deposits and corporate cash have not historically been our primary source of funding and can be impacted by a number of factors.

These capital markets risks may be partially mitigated by the availability of bank deposits and other corporate cash (if any) to temporarily hold the loans on our balance sheet, and by utilizing our Loan Platform Business to originate and sell loans, in certain instances on a fixed fee basis.

However, bank deposits and corporate cash have not historically been our primary source of funding and can be impacted by a number of factors, and our Loan Platform Business is new and does not have a significant performance history.

Our ability to obtain financing in the capital markets depends, among other things, on our development efforts, business plans, operating performance, lending activities, public perceptions of the financial services industry, and condition of, and our access to, the capital markets at the time we seek financing.

The capital markets have recently and from time to time experienced periods of significant volatility, including volatility driven by rising inflation, uncertainty in the financial services sector, the war between Israel and Hamas, and the ongoing war in Ukraine, among other things.

The capital markets have from time-to-time experienced periods of significant volatility, including, most recently, volatility driven by benchmark interest rate movements, uncertainty in the financial services sector, and the ongoing war in Ukraine, among other things.

This volatility can dramatically and adversely affect financing costs when compared to historical norms or make funding unavailable.

Additional factors that could make financing more expensive or unavailable to us include, but are not limited to, financial losses, events that have an adverse impact on our reputation, lawsuits challenging our business practices, adverse regulatory changes, changes in the activities of our business partners, loan performance, events that have an adverse impact on the financial services industry generally, counterparty availability, negative credit rating actions with respect to our rated securities, corporate and regulatory actions, interest rate changes, general economic conditions, including changing expectations for inflation and deflation, and the legal, regulatory and tax environments governing funding transactions, including existing or future securitization transactions.

Additional factors that could make financing more expensive or unavailable to us include, but are not limited to, financial losses, events that have an adverse impact on our reputation, lawsuits challenging our business practices, adverse regulatory changes, changes in the activities of our business partners, loan performance, events that have an adverse impact on the financial services industry generally, counterparty availability, negative credit rating actions with respect to our rated securities, corporate and regulatory actions, interest rate changes, general economic conditions, including changing expectations for inflation, and the legal, regulatory and tax environments governing funding transactions, including existing or future securitization transactions.

If financing is difficult, expensive or unavailable, our business, financial condition, results of operations, cash flows and future prospects could be materially and adversely affected.

Changing expectations for inflation and deflation and corresponding fluctuations in interest rates could decrease demand for our lending products and negatively affect loan performance, as well as increase certain operating costs, such as employee compensation.

There is particular uncertainty about the prospects for growth in the U.S.

A number of factors influence the potential economic uncertainty, including, but not limited to, changing U.S.

consumer spending patterns, elevated and fluctuating inflation and interest rates, reduced consumer discretionary spending, and weakening wage growth and employment levels.

For example, the Federal Reserve increased interest rates throughout 2022 and multiple times in 2023, and we are unable to predict whether it will continue to raise rates further.

Increased interest rates may decrease borrower demand for certain of our lending products, even as inflation places pressure on consumer spending, borrowing and saving habits as consumers evaluate their prospects for future income growth and employment opportunities in the current economic environment, and as borrowers face uncertainty about the impact of elevated prices on their ability to repay a loan.

Changing expectations for inflation and fluctuations in interest rates could decrease demand for our lending products and negatively affect loan performance, as well as increase certain operating costs, such as employee compensation.

economy has remained strong despite facing certain headwinds, including, but not limited to, changing U.S.

consumer spending patterns, fluctuating inflation and interest rates, reduced consumer discretionary spending, and weakening wage growth, but there is no guarantee that future changes will not have an impact.

For example, the Federal Reserve increased interest rates throughout 2022 and 2023 before lowering interest rates in 2024.

We are unable to predict whether interest rates will increase or decrease in the future.

Continued elevated interest rates may decrease borrower demand for certain of our lending products, even as inflation places pressure on consumer spending, borrowing and saving habits as consumers evaluate

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their prospects for future income growth and employment opportunities in the current economic environment, and as borrowers face uncertainty about the impact of elevated prices on their ability to repay a loan.

A change in demand for our lending products and any steps we may take to mitigate such change could impact our credit quality and overall growth.

For example, we have experienced lower demand for our home loans in an elevated interest rate environment, as our historical demand has primarily resulted from refinancing, which is less attractive in a higher interest rate environment.

Although demand for refinanced student loans has increased following the expiration of the moratorium on federal student loan payments at the end of August 2023, it has not yet returned to pre-COVID levels.

We have also focused on personal loan originations to offset the lower demand in other lending products.

Personal loans are a higher risk product than home loans or student loans and we have recently seen an increase in the amount of personal loans that we originate which may increase the inherent risk in our overall portfolio.

Personal loans are a higher risk product than home loans or student loans and we have seen an increase in the amount of personal loans that we originate which may increase the inherent risk in our overall portfolio.

In addition, fluctuating interest rates may increase our cost of capital and ability to offer a competitive interest rate on our loans.

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Fluctuations in interest rates could negatively affect the demand for our checking and savings product.

Falling, low or fluctuating interest rates, which we have experienced in the past and may experience again in the future, may have a negative impact on the demand for our checking and savings product.

Falling, low or fluctuating interest rates, including declining interest rates in 2024, have in the past had and may in the future have a negative impact on the demand for our checking and savings product.

Checking and savings provides members a digital banking experience that offers a variable annual percentage yield, which is at our discretion.

If we are not able to offer competitive interest rates on deposit accounts, demand for our checking and savings product may decrease, which may impact our ability to access deposits as a more cost-effective source of funding for our loans.

Although we have been in an elevated interest rate environment in recent years, there is no guarantee that it will remain so or that the interest rate we offer on

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deposit accounts will remain competitive and in a falling or low interest rate environment, account holders and prospective account holders may be discouraged from using these products, which would adversely affect our business, financial condition, results of operations, cash flows and future prospects.

Higher than expected payment speeds of loans could negatively impact our returns as the holder of the residual interests in securitization trusts holding personal and student loans.

Although we have been in an elevated interest rate environment in recent years, interest rates began to decline in 2024 and there is no guarantee that the interest rate we offer on our deposit accounts will remain competitive and in a falling or low interest rate environment, account holders and prospective account holders may be discouraged from using these products, which would adversely affect our business, financial condition, results of operations, cash flows and future prospects.

Higher than expected payment speeds of loans could negatively impact the fair market value of the lending portfolio and our returns as the holder of the residual interests in securitization trusts holding personal and student loans.

These factors could materially alter our net revenue or the value of our residual interest holdings.

The rate at which borrowers prepay their loans can have a material impact on our net revenue and the value of our residual interests in securitization trusts.

Prepayment rates are subject to a variety of economic, social, competitive and other factors, including fluctuations in interest rates, availability of alternative financings, legislative, regulatory or policy changes affecting the student loan market, the home loan market, consumer lending generally and the general economy, including changing expectations for inflation and deflation.

The rate at which borrowers prepay their loans can have a material impact on our net revenue, the value of our lending portfolio and the value of our residual interests in securitization trusts.

For example, interest rates began to decline in 2024, and a lower interest rate environment may lead to higher prepayment rates on loans.

While we anticipate some variability in prepayment rates, extraordinary or extended increases or decreases in prepayment rates could materially affect our liquidity and net revenue.

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In such cases, our net revenue may decrease, inclusive of our servicing revenue and the diminished value of any retained residual interest by us in the trust.

Finally, rating agencies may place bonds on watch or change their ratings on (or their ratings methodology for) the bonds issued by a securitization trust, possibly raising or lowering their ratings, based upon these prepayment rates and their perception of the risk posed by those rates to the timing of the trust cash flows.

Finally, in instances of significant slowdowns in payment rates, rating agencies may place bonds on watch or change their ratings on (or their ratings methodology for) the bonds issued by a securitization trust, possibly raising or lowering their ratings, based upon these prepayment rates and their perception of the risk posed by those rates to the timing of the trust cash flows.

Placing bonds on watch, changing ratings negatively, proposing or making changes to ratings methodology could:

(i) affect our liquidity, (ii) impede our access to the securitization markets, (iii) require changes to our securitization structures, and (iv) raise or lower the value of the residual interests of our future securitization transactions.

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We are exposed to financial risks that may be partially mitigated but cannot be eliminated by our hedging activities, which carry their own risks.

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Any failure to manage our hedging positions properly or inability to enter into hedging instruments under acceptable terms, or any other unintended or unanticipated economic consequences of our hedging activities, could affect our financial condition and results of operations.

Our financial condition and results of operations have been and may in the future be adversely impacted by an epidemic or pandemic, including the COVID-19 pandemic.

Our financial condition and results of operations have been and may in the future be adversely impacted by an epidemic or pandemic.

Occurrences of epidemics or pandemics, depending on their scale, may cause different degrees of disruption to the regional, state and local economies in which we offer our products and services.

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Any future pandemic or public health crisis may result in, among other impacts, worker shortages, supply chain issues, inflationary pressures, and the reinstatement and subsequent lifting of restrictions and health and safety related measures.

Any COVID-19 resurgences or future epidemics or pandemics or other public health crises could adversely affect our business, operations and financial condition, as well as the business, operations and financial conditions of our members, other customers and partners.

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See “ Our business and results of operations have in the past and may in the future be adversely affected by the financial markets, fiscal, monetary, and regulatory policies, and economic conditions generally ” and “ Management’s Discussion and Analysis of our Financial Condition and Results of Operations—Key Business Metrics ” and “ —Consolidated Results of Operations ” for further discussion of the impact of macroeconomic conditions in recent periods on our business and operating results.

Any future epidemics or pandemics or other public health crises could adversely affect our business, operations and financial condition, as well as the business, operations and financial conditions of our members, other customers and partners.

See “ Our business and results of operations have in the past and may in the future be adversely affected by the financial markets, fiscal, monetary, and regulatory policies, and economic conditions generally ” and “ Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics ” and “ —Consolidated Results of Operations ” for further discussion of the impact of macroeconomic conditions in recent periods on our business and operating results.

Strategic and New Product Risks

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• integration of the acquired company’s accounting, management information, human resources, third-party risk management and other administrative systems;

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• the need to implement or improve controls, procedures and policies at a business that prior to the acquisition may have lacked effective controls, information security and cybersecurity safeguards, procedures and policies, including third-party risk management practices;

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In addition, we may increasingly rely on technological innovation as we introduce new types of products, expand our current products into new markets, and continue to streamline our platform.

For example, while we do not currently

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rely heavily on artificial intelligence, we expect to integrate more artificial intelligence into our technology in the future especially to improve the experience of our members.

For example, while we do not currently rely heavily on artificial intelligence, we expect to integrate more artificial intelligence into our technology in the future especially to improve the experience of our members.

Even if we enhance our current products or release new products that incorporate artificial intelligence, there can be no assurance that our products will be successful or that we will innovate effectively to keep pace with the rapid evolution of artificial intelligence.

Our ability to integrate artificial intelligence or other new technologies may also be limited by new laws or regulatory guidance.

The process of developing new technologies and products is complex, and if we are unable to successfully innovate and continue to deliver a superior member and technology platform client experience, members’ and clients’ demand for our products may decrease and our growth and operations may be harmed.

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Risks associated with each of these include theft of funds and other monetary loss, the effects of which could be compounded if not detected quickly.

Fraudulent activity may not be detected until well after it occurs and the severity and potential impact may not be fully known for a substantial period of time after it has been discovered.

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activity may not be detected until well after it occurs and the severity and potential impact may not be fully known for a substantial period of time after it has been discovered.

Fraudulent activity and other actual or perceived failures to maintain a product’s integrity and/or security has led to increased regulatory scrutiny and may lead to regulatory investigations and intervention (such as mandatory card reissuance), increased litigation (including class action litigation), remediation, fines and response costs, negative assessments of us and our subsidiaries by regulators and rating agencies, reputational and financial damage to our brand, and reduced usage of our products and services, all of which could have a material adverse impact on our business.

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Although we maintain insurance, there can be no assurance that liabilities or losses we may incur will be covered under such policies or that the amount of insurance will be adequate.

SoFi may be unable to realize the anticipated benefits of acquiring Technisys.

We may be unable to realize the anticipated benefits of acquiring Technisys.

We closed the Technisys acquisition in March 2022 and its operations have been largely integrated into our business.

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Failure to achieve these anticipated benefits could result in increased costs, decreases in the amount of expected revenues, lost cost savings and incremental revenue opportunities and diversion of management’s time and energy and could have an adverse effect on our business, financial condition, operating results and prospects.

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We may continue to expand operations abroad where we have limited operating experience and may be subject to increased business, economic and regulatory risks that could adversely impact our financial results.

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• different regulations and practices with respect to employee/employer relationships, existence of workers’ councils and labor unions, and other challenges caused by distance, language, and cultural differences, making it harder to do business in certain international jurisdictions;

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• compliance with statutory equity requirements;

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In an economic downturn, member default rates may increase, there may be decreased demand for our products, and there may be adverse impacts to our business.

Recent macroeconomic factors, such as elevated interest rates, global events and market volatility, may cause the economy to enter into a period of slower economic growth or a recession, the length and severity of which cannot be predicted.

Recent macroeconomic factors, such as elevated interest rates, global events and market volatility and general uncertainty, may cause the economy to enter into a period of slower economic growth or a recession, the length and severity of which cannot be predicted.

Such uncertainty and negative trends in general economic conditions can have a significant negative impact on our ability to generate adequate revenue and to absorb expected and unexpected losses.

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Declining economic conditions may also lead to either decreased demand for our loans or demand for a higher yield on our loans, and consequently lower prices or a lower advance rate, from institutional whole loan purchasers, securitization investors and warehouse lenders on whom we rely for liquidity.

The longevity and severity of a downturn or recession will also place pressure on lenders under our debt warehouses, whole loan purchasers and investors in our securitizations, each of whom may have less available liquidity to invest in our loans, and long-term market disruptions could negatively impact the securitization market as a whole.

Although certain of our

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debt warehouses contain committed terms, there can be no assurance that our financing arrangements will remain available to us through any particular business cycle or be renewed on the same terms.

The longevity and severity of a downturn or recession would also place pressure on lenders under our debt warehouses, whole loan purchasers and investors in our securitizations, each of whom may have less available liquidity to invest in our loans, and long-term market disruptions could negatively impact the securitization market as a whole.

Although certain of our debt warehouses contain committed terms, there can be no assurance that our financing arrangements will remain available to us through any particular business cycle or be renewed on the same terms.

The timing and extent of a downturn may also require us to change, postpone or cancel our strategic initiatives or growth plans to pursue shorter-term sustainability.

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These impacts, in addition to limiting our access to capital and negatively impacting our profitability, could also in turn increase the volatility of the mark-to-market methodology we use to determine the fair value of the loans and credit card receivables we hold on balance sheet and consequently have a material adverse effect on our revenues, results of operations, capital requirements, liquidity and cash flows.

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If we do not make accurate credit and pricing decisions or effectively forecast our loss rates, our business and financial results will be harmed, and the harm could be material.

In making a decision whether to extend credit to prospective or existing members, we rely upon data to assess our ability to extend credit within our risk appetite, our debt servicing capacity, and overall risk level to determine lending exposure and loan pricing.

In deciding whether to extend credit to prospective or existing members, we rely upon data to assess our ability to extend credit within our risk appetite, our debt servicing capacity, and overall risk level to determine lending exposure and loan pricing.

If the decision components, rapidly deteriorating macroeconomic conditions or analytics are either unstable, biased, or missing key pieces of information, the wrong decisions will be made, which will negatively affect our financial results.

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Additionally, we rely on the accuracy of applicant information in approving applicants for our non-lending products, such as SoFi Money, SoFi Credit Card or SoFi Invest accounts.

If the information provided to us by these applicants is incorrect or fraudulent and we are unable to detect the inaccuracies, it increases our

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regulatory and fraud risk and the risk of identity theft to our members, and could harm our reputation, business and results of operations.

If the information provided to us by these applicants is incorrect or fraudulent and we are unable to detect the inaccuracies, it increases our regulatory and fraud risk and the risk of identity theft to our members, and could harm our reputation, business and results of operations.

We use identity and fraud prevention tools to analyze data provided by external databases or automated physical identity document proofing technologies to authenticate each applicant’s identity.

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From time to time in the past, however, these checks have failed and there is a risk that these checks could fail in the future and fraud, which may be significant, may occur and go undetected.

For example, in the past we have identified certain fraudulent activity related to our personal loans product.

For example, in the past we have identified certain fraudulent activity related to our personal loan products.

While the fraudulent activity was detected and the losses were recognized in our results of operations, there can be no assurance there will not be future instances of fraud, that we will be able to detect such fraudulent activity in a timely manner, or that such future fraudulent activity will not be material.

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Internet-based loan origination processes may give rise to greater risks than paper-based processes.

We use internet-based loan processes to obtain application information and distribute certain legally required notices to applicants for, and borrowers of, our loans and to obtain electronically signed loan documents in lieu of paper documents with ink signatures obtained in person.

We use internet-based loan processes to obtain application information and distribute certain legally required notices to applicants for, and borrowers of, loans and to obtain electronically signed loan documents in lieu of paper documents with ink signatures obtained in person.

These processes may entail greater risks than paper-based loan origination processes, including regarding the sufficiency of notice for compliance with consumer protection laws, risks that borrowers may challenge the authenticity of loan documents, or the validity of the borrower’s electronic signature on loan documents, and risks that unauthorized changes are made to the electronic loan documents.

If any of those factors were to cause our loans, or any of the terms of our loans, to be unenforceable against the relevant borrowers, or impair our ability to service our loans (as master servicer or servicer), the value of our loan assets would decrease significantly to us and to our whole loan purchasers, securitization investors and warehouse lenders.

If any of those factors were to cause our loans, or any of the

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terms of our loans, to be unenforceable against the relevant borrowers, or impair our ability to service our loans (as master servicer or servicer), the value of our loan assets would decrease significantly to us and to our whole loan purchasers, securitization investors and warehouse lenders.

In addition to increased default rates and losses on our loans, this could lead to the loss of whole loan purchasers and securitization investors and trigger terminations and amortizations under our debt warehouse facilities, each of which would materially adversely impact our business.

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However, a private education loan may be discharged if a debtor files an adversary claim and the bankruptcy court determines that not discharging the debt would impose an undue hardship on the debtor and the debtor’s dependents.

New policies implemented by the Biden Administration in late 2022 gave judges more leeway to discharge student loans, resulting in more borrowers discharging their student loans in bankruptcy in 2023, compared to prior years.

In addition, in November 2022, the Department of Justice introduced a new process for handling student loan discharge cases intended to reduce the burden on debtors pursuing discharge of their federal student loans in bankruptcy.

Further, bills have been introduced in Congress that would make student loans dischargeable in bankruptcy to the same extent as other forms of unsecured credit without regard to a hardship analysis.

For example, in October 2022, then House Judiciary Chair Jerrold Nadler and Representative David Cicilline introduced the Student Borrower Bankruptcy Relief Act of 2022, which would eliminate the section of the U.S.

bankruptcy code that makes private and federal student loans non-dischargeable through bankruptcy.

In addition, changes in law, regulations or governmental policies could increase the number of student loans subject to discharge in certain circumstances which would adversely affect our business.

For example, the Biden Administration gave judges more leeway to discharge student loans, resulting in more borrowers discharging their student loans in bankruptcy in 2023, compared to prior years.

It is possible that a higher percentage of borrowers will obtain relief under bankruptcy or other debtor relief laws in the future than is reflected in our historical experience.

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Despite recession-readiness planning and stress forecasting, there is no assurance that our credit criteria can accurately predict loan performance under economic conditions such as a prolonged down-cycle or recessionary economic environment or the governmental response to periods of disruption, which may drive unexpected outcomes.

If our criteria do not accurately reflect credit risk on the personal loans, greater than expected losses may

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result on these loans and our business, operating results, financial condition and prospects could be materially and adversely affected.

If our criteria do not accurately reflect credit risk on the personal loans, greater than expected losses may result on these loans and our business, operating results, financial condition and prospects could be materially and adversely affected.

In addition, personal loans are dischargeable in a bankruptcy proceeding involving a borrower without the need for the borrower to file an adversary proceeding.

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The effect of these factors may be to reduce the amounts collected on our personal loans and adversely affect our operating results and financial condition.

We service all of the personal loans we originate and credit cards we issue and have limited servicing experience, and we rely on third-party service providers to service the student loans and home loans we originate, and to perform various other functions in connection with the origination and servicing of certain of our loans.

We service all of the personal loans we originate and credit cards we issue, as well as other loans, and have limited servicing experience, and we rely on third-party service providers to service the student loans and home loans we originate, and to perform various other functions in connection with the origination and servicing of certain loans.

If we or a third-party service provider fails to properly perform these functions, our business and our ability to service our loans may be adversely affected.

We service all of the personal loans we originate and, in all material respects, all of the credit cards we issue, and we have limited experience with such servicing.

We service all of the personal loans we originate as well as certain loans originated by third parties and, in all material respects, all of the credit cards we issue, and we have limited experience with such servicing.

We may begin servicing the student loans that we originate at some time in the future.

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In the event that a third-party service provider for any reason fails to perform such functions, including through negligence, willful misconduct or fraud, our ability to process payments and perform other operational functions for which we currently rely on such third-party service providers will suffer and our business, cash flows and future prospects may be negatively impacted.

Any failure on our part or on the part of third parties on whom we rely to perform functions related to our servicing activities to properly service our loans could result in us being removed as the servicer on the loans we originate, including loans financed by our warehouse facilities or sold into our whole loan sales channel and securitization transactions.

Such third-party service provider failures could also result in, among other things, increased regulatory scrutiny of our third-party service provider oversight, costly

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investigations, required corrective action and remediation, regulatory enforcement actions, class action lawsuits, and harm to our reputation.

Any failure on our part or on the part of third parties on whom we rely to perform functions related to our servicing activities to properly service our loans or the loans originated by third parties could result in us being removed as the servicer on the loans, including loans financed by our warehouse facilities or sold into our whole loan sales channel and securitization transactions.

If we fail to monitor our student loan sub-servicer and ensure that such sub-servicer complies with its obligations under state laws that require student loan servicers to be licensed, we may face civil claims for damages under such state laws.

Because we receive revenue from such servicing activities, any such removal as the servicer or, with respect to our student loans, master servicer, could adversely affect our business, operating results, financial condition or prospects, as would the cost of onboarding a new servicer.

Because we receive revenue from such servicing activities, any such removal as the servicer or master servicer, could adversely affect our business, operating results, financial condition or prospects, as would the cost of onboarding a new servicer.

Furthermore, we have agreed in our servicing agreements to service loans in accordance with the standards set forth therein and may be obligated to repurchase loans or indemnify the buyer of any such loans if we fail to meet those standards.

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In the event that we fail for any reason to perform or manage such functions in accordance with all applicable requirements, including through human errors, technology errors, negligence, willful misconduct or fraud, our ability to originate home loans will suffer and our business, cash flows and future prospects may be negatively impacted, and we could incur penalties or liabilities including obligations to repurchase loans from investors to whom we sold the loans.

Additionally, if we fail to perform such functions or

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properly manage our new resources, we may be unable to complete, or be delayed in the completion of, the origination of home loans in our pipeline and to originate new home loans, and we may not be able to onboard a replacement service provider that has the ability to promptly provide the same services in the same manner and on the same economic terms.

Additionally, if we fail to perform such functions or properly manage our new resources, we may be unable to complete, or be delayed in the completion of, the origination of home loans in our pipeline and to originate new home loans, and we may not be able to onboard a replacement service provider that has the ability to promptly provide the same services in the same manner and on the same economic terms.

Potential geographic concentration of our members may increase the risk of loss on the loans that we originate and negatively impact our business.

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from time to time will experience weaker economic conditions and higher unemployment and, consequently, will experience higher rates of delinquency and loss than on similar loans in other regions of the country.

Moreover, a further deterioration in economic conditions or a recession, outbreaks of disease (such as additional COVID-19 strains or variants), the continued increase in extreme weather conditions and other natural events (such as hurricanes, tornadoes, floods, drought, wildfires, mudslides, earthquakes and other extreme conditions) and other factors could adversely affect the ability and willingness of borrowers in affected regions to meet their payment obligations under their loans and may consequently affect the delinquency and loss experience of such loans.

Moreover, a further deterioration in economic conditions or a recession, outbreaks of disease, the continued increase in extreme weather conditions and other natural events (such as hurricanes, tornadoes, floods, drought, wildfires, mudslides, earthquakes and other extreme conditions) and other factors could adversely affect the ability and willingness of borrowers in affected regions to meet their payment obligations under their loans and may consequently affect the delinquency and loss experience of such loans.

In addition, we, as master servicer for all student loans and home loans and as servicer of our personal loans, have offered in the past, and may in the future offer, hardship forbearance or other relief programs in certain circumstances to affected borrowers.

Conversely, an improvement in economic conditions in one or more of the geographic areas in which we have members could result in higher prepayments of their payment obligations under their loans by borrowers in such states.

As a result, we and the whole loan purchasers who hold our loans or securitization investors or warehouse lenders who hold securities backed by our loans may receive principal payments earlier than anticipated, and fewer interest payments than anticipated, and face certain reinvestment risks, such as the inability to acquire loans on equally attractive terms as the prepaid loans.

In addition, higher prepayments than anticipated may have a negative impact on our servicing revenue which could cause our operating results and financial condition to be materially and adversely affected.

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Further, the concentration of our loans in one or more geographic locations may have a disproportionate effect on us or investors in our loans or securities backed by our loans if governmental authorities in any of those areas take action against us as originator, master servicer or servicer of those loans or take action affecting our ability as master servicer or servicer to service those loans.

Funding and Liquidity Risks

If we are unable to retain and/or increase our current sources of funding, including deposits, and secure new or alternative methods of financing, our ability to finance additional loans and introduce new products will be negatively impacted.

Historically, in addition to the issuance of equity, we have funded our operations and capital expenditures primarily through access to the capital markets through sales of our loans, access to secured and unsecured borrowing facilities and utilization of securitization financing from consolidated and nonconsolidated VIEs.

In each of these instances (other than for certain whole loan sales of home loans), we retain the servicing rights to our loans from which we earn a servicing fee.

In securitization financing transactions, we transfer a pool of loans originated by SoFi Lending Corp.

or SoFi Bank to a VIE which is sponsored by SoFi Lending Corp.

or SoFi Bank, and we retain risk in the VIE, typically in the form of asset-backed bonds and residual interest investments.

Through SoFi Bank, we utilize deposits as well, which offer us a lower cost source of funds, and we have the ability to access other funding sources, such as the FHLB and certain brokered deposit channels established by SoFi Bank.

We rely on each of these outlets for liquidity and the loss or reduction of any one of these outlets, including deposits, could materially adversely impact our business.

For example, certain banks have faced operational difficulties in accessing the FHLB discount window and there is no guarantee that we will not face the same or similar issues.

In addition, there can be no assurance that we will be able to successfully access the securitization markets at any given time, or that deposits at SoFi Bank will remain at current levels or grow, and in the event of a sudden or unexpected shortage of funds in the banking and financial system, we cannot be sure that we will be able to maintain necessary levels of funding without incurring high funding costs, a reduction in the term of funding instruments, an increase in the amount of equity we are required to hold or the liquidation of certain assets.

If we are unable to successfully manage our assets and liabilities on the balance sheet and our funding costs, including with respect to deposit-based funding, our ability to finance additional loans and introduce new products may be negatively impacted.

We fund our operations and capital expenditures primarily through SoFi Bank deposits, warehouse funding, common equity capital, convertible debt, a corporate revolving credit facility, securitizations, and other financings.

Through SoFi Bank, we utilize deposits which generally has a lower borrowing cost of funds than warehouse financing, and we have the ability to access other funding sources, such as the FHLB and certain brokered deposit channels established by SoFi Bank.

Because we rely on each of these outlets for liquidity, if we are unable to successfully manage our assets and liabilities and funding costs as described above, or if we experience a loss or reduction of these liquidity outlets, our business could be materially adversely impacted.

For example, certain banks have faced operational difficulties in accessing the Federal Reserve discount window and there is no guarantee that we will not face the same or similar issues.

In addition, there can be no assurance that we will be able to successfully access the securitization markets at any given time, and in the event of a sudden or unexpected shortage of funds in the banking and financial system, we cannot be sure that we will be able to maintain necessary levels of funding without incurring high funding costs, a reduction in the term of funding instruments, an increase in the amount of equity we are required to hold or the liquidation of certain assets.

Furthermore, there is a risk that there will be no market at all for our loans either from whole loan buyers or through investments in securities backed by our loans.

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As the volume of loans that we originate, and the increased suite of products that we make available to members, increases, we may be required to expand the size of our debt warehousing facilities or seek additional sources of capital.

The availability of these financing sources depends on many factors, some of which are outside of our

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The availability of these financing sources depends on many factors, some of which are outside of our control.

We may also experience the occurrence of events of default or breaches of financial performance or other covenants under our debt agreements, which could reduce or terminate our access to institutional funding.

If we are unable to increase our current sources of funding, including deposits, and secure new or alternative methods of financing, our ability to finance additional loans and to develop and offer new products will be negatively impacted.

As we think about managing our assets and liabilities on the balance sheet and our funding costs, our deposit growth may slow.

If we are unable to satisfactorily manage our current sources of funding, including deposits, or, if needed, secure new or alternative methods of financing, our ability to finance additional loans and to develop and offer new products may be negatively impacted.

If deposit growth slows, we may need to turn to higher cost of funds.

The interest rates, advance rates and other costs of new, renewed or amended facilities may also be higher than those currently in effect.

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These restrictions may interfere with our ability to obtain financing or to engage in other business activities, which could materially and adversely affect us.

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There can be no assurance that we will maintain compliance with all financial and other covenants included in our warehouse facilities in the future.

In addition, our agreements with our warehouse lenders contain various concentration limits and triggers, including related to excess spread.

As high interest rates place pressure on our net cost of funds for loans held at SoFi Lending Corp., which do not benefit from deposit funding through SoFi Bank, the likelihood of reaching an excess spread limit increases.

High interest rates have in the past and may in the future place pressure on our net cost of funds for loans held at SoFi Lending Corp., which do not benefit from deposit funding through SoFi Bank, and increase the likelihood of reaching an excess spread limit.

A breach of such limits or other similar terms of such agreements could result in an inability to place loans in the relevant warehouse facilities and require us to pursue other forms of financing.

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Our loans performance and any actions taken by the rating agencies could result in the lenders under our warehouse facilities, the whole loan purchasers who purchase our loans, the investors in our securitizations who purchase securities backed by our loans, or future lenders, whole loan purchasers or securitization investors in similar arrangements, increasing the cost of providing future financing or refusing to provide future financing or purchase loans on terms acceptable to us or at all.

While this risk may be partially mitigated by our ability to hold loans on our balance sheet, in sufficient volume this will negatively impact our financial condition.

While this risk may be partially mitigated by our ability to hold loans on our balance sheet, in sufficient volume, high member default rates would negatively impact our financial condition.

Consequently, if we were to be unable to arrange new or alternative methods of financing on favorable terms, we may have to curtail or cease our origination of loans, which could have a material adverse effect on our business, financial condition, operating results and cash flows.

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We make representations and warranties in connection with the transfer of loans to whole loan purchasers, government-sponsored enterprises, and our debt warehouse lenders and securitization trusts.

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Any such event could have an adverse impact on our business, operating results, financial condition and prospects.

In addition, in the acquisition of Wyndham, we also acquired Wyndham's liability to its loan investors and loan insurers for mortgage loans originated by Wyndham, including repurchase obligations that might not be contingent upon the investor proving an error by Wyndham.

In addition, in the acquisition of Wyndham, we also acquired

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Wyndham's liability to its loan investors and loan insurers for mortgage loans originated by Wyndham, including repurchase obligations that might not be contingent upon the investor proving an error by Wyndham.

In addition to loan level representations and warranties, our agreements with the lenders and investors on our securitizations, debt warehouse facilities and corporate revolving debt contain a number of corporate financial covenants and early payment triggers and performance covenants.

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If we were unable to arrange new or alternative methods of financing on favorable terms, we might have to hold loans on balance sheet in an amount that may negatively impact our financial condition, or curtail or cease the origination of loans, which could impair our growth, and, in each case, have a material adverse effect on our business, financial condition, operating results and cash flows, which in turn could have a material adverse effect on our ability to meet our obligations under our facilities.

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We require substantial capital and, in the future, may require additional capital, to pursue our business objectives and achieve recurring profitability.

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Volatility in the credit markets in general or in the market for personal, student and home loans and credit cards in particular may also have an adverse effect on our ability to obtain debt financing.

Furthermore, the cost of our borrowing has increased and may continue to increase due to market volatility, interest rates that are higher than those in the recent past, changes in the risk premiums required by lenders or the unavailability of traditional sources of debt capital.

Although our borrowing costs have trended lower following the acquisition of a national bank charter, the cost of our borrowing could increase due to market volatility, interest rates that are higher than those in the recent past, changes in the risk premiums required by lenders or the unavailability of traditional sources of debt capital.

Volatility or depressed valuations or trading prices in the equity markets may similarly adversely affect our ability to obtain equity financing.

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In addition, maintaining adequate liquidity is crucial to our securities brokerage, including key functions such as transaction settlement, custody requirements and margin lending.

Our broker-dealer subsidiary, SoFi Securities, is subject to Rule 15c3-1 under the Exchange Act, which specifies minimum capital requirements intended to ensure the general financial soundness and liquidity of broker-dealers, and SoFi Securities is subject to Rule 15c3-3 under the Exchange Act, which requires broker-dealers to maintain certain liquidity reserves.

Our broker-dealer subsidiary, SoFi Securities, is subject to Rule 15c3-1 under the Exchange Act, which

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specifies minimum capital requirements intended to ensure the general financial soundness and liquidity of broker-dealers, and SoFi Securities is subject to Rule 15c3-3 under the Exchange Act, which requires broker-dealers to maintain certain liquidity reserves.

We meet our liquidity needs primarily from working capital, deposits and cash generated by member activity, as well as from external debt and equity financing.

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There can be no assurance that we can obtain sufficient sources of external capital to support the growth of our business.

Delays in doing so or failure to do so may require us

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to reduce loan originations or reduce our operations, which would harm our ability to pursue our business objectives as well as harm our business, operating results and financial condition.

Delays in doing so or failure to do so may require us to reduce loan originations or reduce our operations, which would harm our ability to pursue our business objectives as well as harm our business, operating results and financial condition.

We are unable to finance all of the receivables that we originate or other assets that we hold, and that illiquidity could result in a negative impact on our financial condition.

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However, revenue growth for checking and savings is dependent on increasing the volume of members who open an account and on growing balances in those accounts.

Although checking and savings accounts have grown since its introduction in the first quarter of 2022, there is no guarantee that account openings and the amount on deposit in those accounts will continue to grow.

Although our checking and savings account product has grown since its introduction in the first quarter of 2022, there is no

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guarantee that account openings and the amount on deposit in those accounts will continue to grow.

In addition, although we have invested in a number of initiatives to attract new checking and savings account holders and capture a greater share of our members’ savings, including offering a competitive annual percentage yield on deposits and offering SoFi Plus membership benefits to deposit holders, there can be no assurance that these investments to acquire and retain members, provide differentiated features and services and spur usage of our deposit account product will be effective or cost effective.

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Any failure to accurately capture credit risk or to execute our funding strategy for SoFi Credit Card could have a negative impact on our business, operating results and financial condition.

The performance of the SoFi Credit Card product is significantly dependent on the ability of the credit and fraud decisioning and scoring models we use to originate the product, which includes a variety of factors, to effectively prevent fraud, evaluate an applicant’s credit profile and likelihood of default.

In October 2024, we expanded our credit card program by launching two new credit cards:

SoFi Everyday Cash Rewards and SoFi Essential.

The performance of these new credit cards and the existing SoFi Unlimited 2% Credit Card products is significantly dependent on the ability of the credit and fraud decisioning and scoring models we use to originate the product, which includes a variety of factors, to effectively prevent fraud, evaluate an applicant’s credit profile and likelihood of default.

Despite establishing a defined risk appetite and leveraging third-party stress testing of product loss forecasts, there is no assurance that our credit criteria can accurately predict repayment and loss profiles.

If our criteria do not accurately prevent fraud or reflect credit risk on the SoFi Credit Card product, greater than expected losses may result and our business, operating results, financial condition and prospects could be materially and adversely affected.

In addition, revenue growth for SoFi Credit Card is dependent on increasing the volume of members who open an account and on growing loan balances on those accounts.

If our criteria do not accurately prevent fraud or reflect credit risk on the SoFi Credit Card products, greater than expected losses may result and our business, operating results, financial condition and prospects could be materially and adversely affected.

In addition, revenue growth for the SoFi Credit Card program is dependent on increasing the volume of members who open an account and on growing loan balances on those accounts.

Over time we will continue to invest in a number of new product initiatives to attract new SoFi Credit Card members and capture a greater share of our members’ total spending and borrowings.

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Revenue growth for SoFi Credit Card may be adversely affected by new restrictions on credit card fees, which were proposed by the CFPB in 2023.

If finalized as written, the rule would significantly reduce the penalty fees that could be charged to a SoFi Credit Card customer who fails to make a timely payment, which may adversely affect revenue and our ability to limit losses resulting from such delinquencies.

While we have generally seen increases in revenue from SoFi Credit Card, there can be no assurance that our investments in SoFi Credit Card to acquire members, provide differentiated features and services and spur usage of our card will continue to be effective, and developing our service offerings and forming new partnerships could have higher costs than anticipated, and could adversely impact our results or dilute our brand.

Furthermore, the success of the SoFi Credit Card product depends on our ability to execute on our funding strategy for the resulting credit card receivables.

Revenue growth for SoFi Credit Card may be adversely affected by new restrictions on credit card fees finalized by the CFPB in March 2024.

Although originally scheduled to become effective in May 2024, the rule was challenged in the 5th U.S.

Circuit Court of Appeals following a stay order from that court.

In December 2024, a federal judge rejected the CFPB’s request to reinstate the credit card late fee cap, effectively ending the CFPB’s attempt to enforce the cap.

With the change to the U.S.

presidential administration in January 2025 and the possible reshaping of the CFPB under new leadership, the CFPB may not continue litigating in favor of the cap, or enforce the cap.

If the CFPB’s rule were to become effective as written, it could, if we modify our terms in response to changes made by issuers impacted by the rule, adversely affect revenue.

The operation of our rewards program for the SoFi Unlimited 2% Credit Card and the SoFi Everyday Cash Rewards could have a negative impact on the revenue for our Credit Card program.

In December 2024, the CFPB published a Consumer Financial Protection Circular, which warned that the CFPB is scrutinizing and taking actions against operators of credit card reward programs, and declared it may be unlawful to devalue earned rewards, use fine print to disclose conditions for earning or redeeming rewards, or change the benefits for which rewards may be earned and redeemed.

This guidance could make it more expensive to operate the rewards program and limit our ability to adapt the program to changing economic conditions.

While we have generally seen increases in revenue from SoFi Credit Card, there can be no assurance that our investments in SoFi Credit Card to acquire members, provide differentiated features and services and spur usage of our cards will continue to be effective, and developing our service offerings and forming new partnerships could have higher costs than anticipated, and could adversely impact our results or dilute our brand.

Furthermore, the success of the SoFi Credit Card products depends on our ability to execute on our funding strategy for the resulting credit card receivables.

We may establish a credit card receivable securitization program in the future.

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In the event we are unable to finance our credit card receivables, we may be required to hold those assets on our consolidated balance sheet or sell them for a loss, either of which could have a negative impact on our business, operating results and financial condition.

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Regulatory, Tax and Other Legal Risks

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The statute and regulation require us to impose certain quantitative limits, collateral requirements and other restrictions on “covered transactions” between SoFi Bank and its affiliates and require all transactions be on “market terms” and conditions consistent with safe and sound banking practices.

For example, Galileo’s provision of technology services to SoFi Bank is subject to Regulation W, including the requirement that the arrangement is on market terms.

The laws, rules, regulations, and supervisory guidance and policies applicable to us are subject to regular modification and change, including increased regulation as a result of the turmoil in the banking industry.

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For example, the Dodd-Frank Act and other federal banking laws subject companies with $10 billion or more of consolidated assets to additional regulatory requirements.

Section 1075 of the Dodd-Frank Act, which is commonly

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known as the “Durbin Amendment”, amended the Electronic Fund Transfer Act to restrict the amount of interchange fees that may be charged and prohibit network exclusivity for debit card transactions.

Section 1075 of the Dodd-Frank Act, which is commonly known as the “Durbin Amendment”, amended the Electronic Fund Transfer Act to restrict the amount of interchange fees that may be charged and prohibit network exclusivity for debit card transactions.

SoFi Bank is required to comply with the restrictions on interchange fees that went into effect on July 1, 2023, which may negatively impact future interchange fees we collect.

In addition, in October 2023, the Federal Reserve proposed changes to the regulations implementing the Electronic Fund Transfer Act that would further restrict the amount of interchange fees that may be charged and require biennial reviews of those fees.

Changes in laws, rules, regulations and supervisory guidance and policies could, among other things, subject us to additional costs, including costs of compliance;

In addition, in November 2023, the Federal Reserve proposed changes to the regulations implementing the Electronic Fund Transfer Act that would further restrict the amount of interchange fees that may be charged and require biennial reviews of those fees.

Guidance from regulators of SoFi Bank can subject its non-bank affiliates to increased governance.

For example, the OCC’s guidance on retail non-deposit investment products, or RNDIPs, applies to referral arrangements that SoFi Bank may have with an affiliate, including SoFi Securities.

This guidance, which was further updated in June 2024 to align with the SEC’s Regulation BI, requires that banks implement and maintain effective oversight and monitoring of relevant RNDIP arrangements to ensure that, among other things, sales transactions and recommendations to retail investors comply with SEC regulations.

Changes in laws, rules, regulations and supervisory guidance and policies could, among other things, subject us to

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additional costs, including costs of compliance;

limit the types of financial services and products we may offer;

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Should we fail to expand and evolve SoFi Bank products in a successful manner, or should these new products, or new regulations or interpretations of existing regulations, impose requirements on us that are cumbersome or that we cannot satisfy, our business may be materially and adversely affected.

Congress, the Trump administration, or any new administration may make substantial changes to fiscal, tax, and other federal policies that may adversely affect our business.

The Trump administration has called for significant changes to U.S.

trade, healthcare, immigration and government regulatory policy and has begun implementing policy changes at a rapid pace.

Changes to U.S.

policy implemented by the U.S.

Congress, the Trump administration or any new administration have impacted among other things, the U.S.

and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S.

regulatory environment, inflation and other areas.

Although we cannot predict the impact, if any, of these changes to our business, they could adversely affect our business.

Until we know what policy changes are made, whether those policy changes are challenged and subsequently upheld by the court system and how those changes impact our business and the business of our competitors over the long term, we will not know if, overall, we will benefit from them or be negatively affected by them.

Failure to comply with applicable laws, regulations or commitments, or to satisfy our regulators’ supervisory expectations, could subject us to, among other things, supervisory or enforcement action, which could adversely affect our business, financial condition and results of operations.

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For example, while SoFi Bank met the definition of “well-capitalized” as of December 31, 2024 and currently has no restrictions regarding acceptance of brokered deposits or setting of interest rates, there can be no assurance that we will continue to meet this definition.

Additionally, our regulators can adjust applicable capital requirements at any time and have authority to place limitations on our deposit businesses.

In July 2024, the FDIC proposed a rule which, if finalized as proposed, would expand the types of deposits that would be considered “brokered deposits” and we could be subject to these restrictions.

Additionally, our regulators can adjust

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applicable capital requirements at any time and have authority to place limitations on our deposit businesses.

An inability to attract or maintain deposits in the future could materially adversely affect our ability to fund our business.

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On March 27, 2020, the CARES Act was signed into law.

In compliance with the CARES Act, payments

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and interest accrual on all loans owned by the U.S.

In compliance with the CARES Act, payments and interest accrual on all loans owned by the U.S.

Department of Education were initially suspended through September 30, 2020, a pause on student loan repayments that was subsequently extended through August 30, 2023 by a series of executive actions.

Interest on federal student loans began accruing on September 1, 2023 and borrowers’ first loan payments were due in October 2023.

Although federal student loans are largely back in repayment, the increased focus in recent years by policymakers on outstanding federal student loans, including, among other things, on the total volume of outstanding loans and on the number of loans outstanding per borrower, has led to discussion of additional potential legislative and regulatory actions and other possible steps to, among other things:

Although federal student loans are back in repayment, the increased focus in recent years by policymakers on outstanding federal student loans, including, among other things, on the total volume of outstanding loans and on the number of loans outstanding per borrower, has led to discussion of additional potential legislative and regulatory actions and other possible steps to, among other things:

• permit private education loans such as our refinanced student loan and in-school student loan products to be discharged in bankruptcy without the need to show undue hardship;

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In addition, there is pressure on policymakers to reduce or cancel student loans or accrued interest at a significant scale, which would further reduce demand for our student loan refinancing product and have a negative impact on our loan origination volume and revenue.

For example, despite legal challenges at the Supreme Court to some of the Biden Administration’s prior student loan forgiveness measures, the Biden Administration continues to pursue options for providing relief to student borrowers, announcing additional relief in June 2023 and January 2024.

In June 2023, the Biden administration announced that it would cancel more than $132 billion of student debt for more than three million borrowers and continue to pursue debt forgiveness strategies including through the Saving on a Valuable Education (SAVE) Plan which offers forgiveness after as few as 10 years of payments for borrowers who originally took out $12,000 or less for college.

In January 2024, the Biden administration announced that it will implement that plan beginning in February 2024, including by automatically canceling loans for certain eligible borrowers.

The future impact to our student loan refinancing product will largely depend on expectations regarding the introduction or implementation of these or any additional relief measures, the interest rate environment, how competitive our student loan refinancing products are compared to our competitors and macroeconomic factors.

For example, despite legal challenges at the Supreme Court to some of the Biden Administration’s prior student loan forgiveness measures, the Biden Administration subsequently continued to pursue options for providing relief to student borrowers.

However, in December 2024, the U.S.

Department of Education withdrew proposed rules seeking to provide student loan debt forgiveness for borrowers experiencing financial hardship and terminated three Program Integrity and Institutional Quality issues, which would have would have allowed the U.S.

Secretary of Education to cancel student loans for several groups of borrowers, including those who had been in repayment for decades and others experiencing financial hardship, and could have reduced or eliminated the education debts of millions of Americans.

In addition, the change of administration in January 2025 has brought uncertainty to the future of student debt relief programs and the U.S.

Department of Education.

The future impact to our student loan refinancing product will also largely depend on expectations regarding the introduction or implementation of these or any additional relief measures, the interest rate environment, how competitive our student loan refinancing products are compared to our competitors and macroeconomic factors.

If in the future, student loans were forgiven or canceled in any meaningful scale, or if federal loan borrowers were permitted to refinance at lower interest rates, our student loan refinancing business within our Lending segment, which is our largest segment, would be materially and adversely affected and our profitability, results of operations, financial condition, cash flows or future business prospects could be materially and adversely affected as a result.

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Although we continue to evaluate the ultimate impact of local, state and federal legislation, regulation and politics, guidance and actions, future legislative, regulatory and executive actions, and the ongoing impact of our own forbearance measures on our financial results, business operations and strategies, there is no guarantee that our estimates will be accurate or that any actions we take based on such estimates will be successful.

Furthermore, we believe that the cost of responding to, and complying with, evolving laws and regulations, as well as any guidance from enforcement actions, will continue to increase, as will the risk of penalties and fines from any enforcement actions that may be imposed on our businesses.

Furthermore, we believe that the cost of responding to, and complying with, evolving laws and regulations, as well as any guidance from enforcement actions, will continue to increase, as

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will the risk of penalties and fines from any enforcement actions that may be imposed on our businesses.

Our profitability, results of operations, financial condition, cash flows or future business prospects could be materially and adversely affected as a result.

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The CFPB, an agency which oversees compliance with and enforces federal consumer financial protection laws, has supervisory authority over the offer, sale or provision of our consumer financial products and services.

Prior to January 1, 2024,

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the OCC examined SoFi Bank for compliance with CFPB rules and enforced CFPB rules with respect to SoFi Bank.

Prior to January 1, 2024, the OCC examined SoFi Bank for compliance with CFPB rules and enforced CFPB rules with respect to SoFi Bank.

In addition, to the extent certain of our lending or loan servicing activity was conducted outside of SoFi Bank, the CFPB had the authority to pursue enforcement actions against us as a company offering those certain consumer financial products or services.

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As part of its regulatory oversight, the CFPB may seek a range of remedies, including rescission of contracts, refund of money, return of real property, restitution, disgorgement of profits or other compensation for unjust enrichment, damages, public notification of the violation and “conduct” restrictions (i.e., future limits on the target’s activities or functions).

Under the current administration and leadership of the agency, the CFPB has pursued a more aggressive enforcement policy with respect to a range of regulatory compliance matters.

For example, on January 6, 2022, the CFPB announced a new initiative to scrutinize so-called consumer “junk fees.” Since then, the CFPB has taken action to constrain “pay-to-pay” fees and has announced a rulemaking proceeding on credit card late fees.

On October 26, 2022, the CFPB issued guidance to banks on how to avoid charging unlawful overdraft and depositor fees.

On February 1, 2023, the CFPB proposed a rule to curb credit card late fees, including proposing an $8 immunity provision to any missed payment.

On March 16, 2023, the CFPB issued a bulletin on unfair billing and collection practices after bankruptcy discharges of certain student loan debt, in violation of the Consumer Financial Protection Act, to notify regulated entities how the CFPB intends to exercise its enforcement and supervisory authorities on this issue.

On July 13, 2023, the CFPB sued Prehired for illegal student lending practices, including misrepresenting the nature of its loans, tricking consumers in its debt collection practices, and suing students in faraway jurisdictions.

In addition, where a company has violated Title X of the Dodd Frank Act, the Dodd-Frank Act empowers state attorneys general and state regulators to bring certain civil actions.

Increased enforcement or rules from the CFPB could increase our legal and financial compliance costs, make some activities more difficult, time-consuming and costly, and increase demand on our systems and resources.

Under the Biden administration, the CFPB pursued a more aggressive enforcement policy with respect to a range of regulatory compliance matters.

For example, on January 6, 2022, the CFPB announced a new initiative to scrutinize so-called consumer “junk fees.” Since then, the CFPB issued guidance to banks on how to avoid charging unlawful overdraft and depositor fees, confirmed their policy against “pay to pay” fees or charging any fees not expressly authorized and properly disclosed in a consumer agreement, issued a final rule limiting credit card penalty fees, which was stayed pending ongoing litigation, and launched an inquiry into junk fees in mortgage closing costs.

The CFPB has also identified additional unfair, deceptive, and abusive acts or practices that could violate the CFPA, including certain billing and collection practices after bankruptcy discharges of certain student loan debt, taking unreasonable advantage of a consumer’s reasonable reliance on an operator or lead generator to act in the consumer’s interests, and including unclear or unenforceable terms and conditions in consumer contracts or fine print.

The CFPB has also focused on student borrower harms from servicing failures, program disruptions, college banking and credit card agreements, and a variety of illegal practices and has been active in litigation against student loan servicers and others, including Climb Credit and its largest shareholder 1/0, Ejudicate, Navient, Prehired, the National Collegiate Student Loan Trusts and Pennsylvania Higher Education Assistance Agency, Western Benefits Group, Student Loan Pro and its owner, Judith Noh, and Performant Recovery, Inc.

for CFPA and other violations.

Increased enforcement or rules from the CFPB could increase our legal and financial compliance costs, require us to evaluate or amend certain activities or products in light of evolving compliance standards, make some activities more difficult, time-consuming and costly, and increase demand on our systems and resources.

In addition, the change of administration in January 2025 has brought uncertainty as to the future of the CFPB and the aggressiveness of its enforcement policies.

We hold lending licenses or similar authorizations in multiple states, each of which has the authority to supervise and examine our activities.

As a licensed consumer lender, mortgage lender, loan broker, collection agency, MSB and loan servicer in certain states, we are subject to examinations by state agencies in those states.

As a licensed consumer lender, mortgage lender, loan broker, collection agency, Money Services Business (“MSB”) and loan servicer in certain states, we are subject to examinations by state agencies in those states.

Similarly, we are subject to licensure requirements and regulations as an education loan servicer in multiple states.

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Compliance with applicable laws is costly, and our failure to comply with applicable federal, state and local laws could lead to:

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• loss of our licenses and approvals to engage in our lending and servicing businesses;

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• loss or restriction of warehouse facilities to fund loans;

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• inability to raise capital;

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The new CRA regulations, which become effective on January 1, 2026, increase the geographic areas in which banks will be evaluated for CRA performance and may be particularly burdensome on banks focused on mobile and digital banking such as SoFi Bank.

The implementation of the new CRA regulations is currently paused pending the resolution of legal challenges to the new regulations.

The OCC’s assessment of our compliance with the CRA is taken into account when evaluating any application we submit for, among other things, a merger or the acquisition of another financial institution.

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We hold state licenses that result in substantial compliance costs, and our business would be adversely affected if our licenses are impaired as a result of noncompliance with those requirements.

We currently hold state licenses in connection with our lending activities, our student loan servicing activities, our securities business as well as our prior MSB activities.

We currently hold state licenses in connection with our lending activities, student loan servicing activities, securities business, and prior MSB activities.

Although we have transitioned our lending products to SoFi Bank, for as long as SoFi Lending Corp.

originates, purchases or master services or services loans, we must comply with certain state licensing requirements and varying compliance requirements.

although we have transferred our digital assets business, we still hold MSB licenses while we determine whether to maintain or relinquish those licenses.

Changes in licensing laws may result in increased disclosure requirements, increased fees, or may impose other conditions to licensing that we or our personnel are unable to meet.

originates, brokers, purchases or master services or services loans, we must comply with certain state licensing requirements and varying compliance requirements.

In addition, although we have transferred our digital assets business and relinquished our state money transmitter licenses, we still hold our MSB license.

Changes in licensing laws may result in

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increased disclosure requirements, increased fees, or may impose other conditions to licensing that we or our personnel are unable to meet.

In most states in which we operate, a regulatory agency or agencies regulate and enforce laws relating to loan servicers, brokers, and originators, collection agencies, and MSBs.

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Fines and penalties incurred in one jurisdiction may cause investigations or other actions by regulators in other jurisdictions.

We may not be able to maintain all currently required licenses and permits.

We may not be able to obtain or maintain all currently required licenses and permits.

If we change or expand our business activities, we may be required to obtain additional licenses before we can engage in those activities.

If we apply for a new license, a regulator may determine that we were required to do so at an earlier point in time, and as a result, may impose penalties or refuse to issue the license, which could require us to modify or limit our activities in the relevant state.

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example, we have been fined in the past by state regulators for engaging in financial services related activities prior to obtaining a license.

Based on changes to our businesses, we may also forfeit certain of our licenses that are no longer required, such as our MSB licenses following the transfer of our digital assets business.

For example, we have been fined in the past by state regulators for engaging in financial services related activities prior to obtaining a license.

Based on changes to our businesses, we may also forfeit certain of our licenses that are no longer required.

Regulators may impose conditions, requirements or penalties in connection with the forfeiture of any of our licenses.

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It is possible that these laws and regulations could be interpreted or applied in a manner that would prohibit, alter or impair our existing or planned products and services.

Regulatory scrutiny of banking as a service, or BaaS, solutions has recently increased and may require us to devote significant resources to enhancing our Technology Platform policies, procedures, operations, controls and products, and the failure to satisfy such increased scrutiny may cause regulators to take action against us or our BaaS partners, or result in a loss of one or more of our BaaS partners.

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Regulatory scrutiny of banking as a service, or BaaS, solutions has increased and may require us to devote significant resources to enhancing our Technology Platform policies, procedures, operations, controls and products, and the failure to satisfy such increased scrutiny may cause regulators to take action against us or our BaaS partners, or result in a loss of one or more of our BaaS partners.

Our Technology Platform facilitates the provision of BaaS products and services to third parties through various card, deposit, payment, transfer, credit and lending solutions that allow financial technology companies or other third parties to, among other things, connect to sponsor banks’ systems directly via application programming interfaces and cloud infrastructure so they can build banking offerings on top of the sponsor banks’ regulated infrastructure.

In addition, our Technology Platform offers an end-to-end core banking platform solution with integrated payment processing.

Furthermore, in connection with our Technology Platform's BaaS solutions, we sometimes offer certain program management, data, analytics, compliance and risk

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management functions.

Furthermore, in connection with our Technology Platform's BaaS solutions, we sometimes offer certain program management, data, analytics, compliance and risk management functions.

The third parties that use these BaaS solutions include a variety of financial entities, including banks, fintech companies and other financial intermediaries.

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Federal Communications Commission (the “FCC”), and the FTC have responsibility for regulating various aspects of some of these federal laws.

Among other requirements, the TCPA requires us to obtain prior express written consent for certain telemarketing calls and to adhere to “do-not-call” registry requirements which, in part, mandate we maintain and regularly update lists of consumers who have chosen not to be called and restrict calls to consumers who are on the national do-not-call list.

In addition, in December 2023, the FCC introduced new regulations under the TCPA addressing lead generator relationships, among other things.

Florida and several other states also have mini-TCPA and other similar consumer protection laws regulating certain telemarketing directed to their residents.

These federal and state laws limit our ability to communicate with consumers and reduce the effectiveness of our marketing programs.

As currently construed, the TCPA does not distinguish between voice and data, and, as such, SMS/MMS messages are also “calls” for the purpose of TCPA obligations and restrictions.

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to consumers who are on the national do-not-call list.

Further, in late 2023 and early 2024, the FCC introduced various new TCPA requirements relating to, among other things, lead generation, prior express written consent to marketing calls made with certain telephony technology and processing opt-outs and do not call requests.

These new requirements went into effect in January 2025.

In addition to federal laws, many states also have mini-TCPA and other similar consumer protection laws regulating certain telemarketing directed to their residents.

Collectively, these federal and state laws limit our ability to communicate with consumers through calls and text messages and reduce the effectiveness of our marketing programs.

As currently construed, the TCPA and several state mini-TCPA laws do not distinguish between voice and data, and, as such, SMS/MMS messages are also “calls” for the purpose of these laws.

For violations of the TCPA, the law provides for a private right of action under which a plaintiff may recover monetary statutory damages of $500 for each call or text made in violation of the statute.

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There is no statutory cap on maximum aggregate exposure for TCPA violations (although some courts have applied in TCPA class actions constitutional limits on excessive penalties).

Like the TCPA, several

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mini-TCPA and other similar state laws also provide for a private right of action under which a plaintiff may recover statutory damages of $500 or more for each violative call or text and enhanced statutory if the violation is knowing or willful.

Like the TCPA, several mini-TCPA and other similar state laws also provide for a private right of action under which a plaintiff may recover statutory damages of $500 or more for each violative call or text and enhanced statutory if the violation is knowing or willful.

An action may be brought by the FCC, a state attorney general, an individual, or a class of individuals.

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New laws, regulations, policy or changes in enforcement of existing laws or regulations applicable to our business, or reexamination of current practices, could adversely impact our profitability, limit our ability to continue existing or pursue new business activities, require us to change certain of our business practices, affect retention of key personnel, or expose us to additional costs (including increased compliance costs and/or customer remediation).

These changes also may require us to invest significant resources, and devote significant management attention, to make any necessary changes and could adversely affect our business.

These changes have in the past and may in the future require us to invest significant resources, and devote significant management attention, to make any necessary changes and could adversely affect our business.

For example, the SEC proposed Regulation Best Execution, along with other proposals related to equity market structure, in December 2022.

If adopted as proposed, Regulation Best Execution and other recent proposals would substantially alter existing order routing, execution incentives and business practices.

The SEC also finalized rules in February 2023 to shorten the standard settlement cycle for most broker-dealer transactions in securities from two business days after the trade (T+2) to one (T+1).

While the SEC compliance date for T+1 is not until May 2024, this change will require technological, operational, and compliance adjustments across the industry that are likely to be time consuming and costly for all market participants.

In March 2023, the SEC proposed multiple rules related to privacy and cybersecurity.

Proposed amendments to Regulation S-P would, among other things:

(i) require covered institutions (including broker-dealers and investment advisers) to adopt written policies and procedures for an incident response program to address unauthorized access to or use of customer information;

and (ii) require covered institutions to have written policies and procedures to provide timely notification to affected individuals whose sensitive customer information was or is reasonably likely to have been accessed or used without authorization.

The SEC reopened the comment period for the Investment Management Cybersecurity Release which proposed new rules that would require registered investment advisers and investment companies to adopt and implement written cybersecurity policies and procedures reasonably designed to address cybersecurity risks, disclose information about cybersecurity risks and incidents, report information confidentially to the SEC about certain cybersecurity incidents, and maintain related records.

In July 2023, the SEC proposed new rules and amendments to address certain conflicts of interest

If adopted as proposed, Regulation Best Execution and other proposals would substantially alter existing order routing, execution incentives and business practices.

In March 2023, the SEC

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associated with the use of predictive data analytics by broker-dealers and investment advisers (“firms”) in investor interactions.

If adopted, the proposed rules would require broker-dealers and investment advisers to evaluate and determine whether their use of certain technologies in investor interactions such as analytical, technological or computational functions, algorithms, models, correlation matrices or similar methods or processes that direct or optimize for investment related behavior, involves a conflict of interest that results in the broker-dealer or investment adviser’s interests being placed ahead of investors’ interests.

Depending on the outcome of any final rule, our ability to use these technologies to generate business activity and revenue may be limited.

See also “ Lawmakers, regulators and other public officials have signaled an increased focus on new or additional laws or regulations that could impact our broker-dealer business and require us to make significant changes to our business model and practices, and could result in significant costs to our business or loss of current revenue streams ”.

Compliance with each of these rules, when and if required, would impose additional costs on our business.

To the extent such proposals affect the equity market structure more broadly, our ability to generate revenue may be impaired.

There is also the risk that, despite our best efforts, the SEC does not view our compliance measures as sufficient.

This risk is substantially elevated where regulators adopt a substantial number of new rules in a short time frame.

proposed multiple rules related to privacy and cybersecurity.

The SEC’s proposed Rule 10 relating to cybersecurity for market entities (including broker-dealers) would impose additional requirements related to incident reporting, the establishment and periodic review of policies and procedures designed to address cybersecurity risks, and disclosure about cybersecurity risks and significant incidents.

On October 13, 2023, the SEC adopted rules relating to providing additional disclosures in the securities lending market.

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These regulations could make securities lending more costly, leading to less overall lending activity and a decrease in revenue.

On February 22, 2024, the SEC adopted amendments to Rule 605 under Exchange Act that requires disclosures for order executions in national market system (“NMS”) stocks.

The amendments modify the type of information required to be disclosed under Rule 605 and expand the scope of reporting entities subject to Rule 605 to include broker-dealers who introduce or carry 100,000 or more customer accounts.

Complying with Rule 605 is a new requirement for us.

In addition, the Rule itself has been modified to include new definitions, new and modified categories of order types, and new statistical measures of execution quality and other metrics.

In May 2024, the SEC adopted amendments to Regulation S-P (“Reg S-P”).

The finalized amendments to Reg S-P are designed to address the expanded use of technology and corresponding risks that have emerged since Reg S-P's original adoption and modernize and improve the protection of consumer financial information by certain financial institutions, also known as "covered institutions" (including broker-dealers and investment advisers).

As adopted, amended Reg S-P (i) requires covered institutions to develop, implement, and maintain written policies and procedures for an incident response program that is reasonably designed to detect, respond to, and recover from unauthorized access to or use of customer information;

(ii) requires that the response program include procedures for covered institutions to provide timely notification to affected individuals whose sensitive customer information was, or is reasonably likely to have been, accessed or used without authorization;

and (iii) broadens the scope of information covered by Regulation S-P's requirements.

On September 18, 2024, the SEC adopted rules that would (i) amend Rule 612 of Regulation NMS to establish a new minimum pricing increment, also known as a tick size, of $0.005 for the quoting of certain NMS stocks;

(ii) reduce the access fee caps applicable to stock exchanges under Rule 610 of Regulation NMS (from $0.003 per share (i.e., 30 mils) to $0.001 per share (i.e., 10 mils) and require national securities exchanges to make the amounts of all fees and rebates determinable at the time of execution;

and (iii) accelerate the implementation of the round lot and odd-lot information definitions adopted in 2020 under the Market Data Infrastructure Rules (“MDI Rules”) and add information about the best odd-lot order to the definition of odd-lot information.

On December 20, 2024, the SEC adopted changes to SEC Rule 15c3-3 and 15c3-1 that modify how broker-dealers protect customer assets and calculate their minimum required “net capital.” These changes, particularly the amendments to Rule 612 and 610 of Regulation NMS, will likely affect the economics for orders executed on national stock exchanges and as a result may impact order routing and order execution decisions by market participants, including third parties on which we rely, like clearing brokers.

See “ Business, Financial and Operational Risks — We rely on third parties to perform certain key functions, and their failure to perform those functions could adversely affect our business, financial condition and results of operations ”.

Compliance with this rule may impose additional cost on our business.

In addition, SoFi Securities’ ability to generate revenue may be impacted as a result of the changes in stock exchange fee caps and the resulting potential changes in order routing and execution decisions.

The ultimate effect of these potential changes is uncertain and may impact how SoFi Securities manages and evaluates its compliance with other obligations, such as its obligation to achieve best execution for customer orders.

See also “ Lawmakers, regulators and other public officials have signaled an increased focus on new or additional laws or regulations that could impact our broker-dealer business and require us to make significant changes to our business model and practices and could result in significant costs to our business or loss of current revenue streams ”.

Compliance with each of these rules, when applicable and if required, would impose additional costs on our business.

To the extent such proposals affect the equity market structure more broadly, our ability to generate revenue may be impaired.

There is also the risk that, despite our best efforts, the SEC or FINRA does not view our compliance measures as sufficient.

This risk is substantially elevated where regulators adopt a substantial number of new rules in a short time frame.

In addition, non-compliance with any adopted requirements would likely result in enforcement action by the SEC or FINRA.

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Changes to statutes, regulations or regulatory policies, including changes in interpretation or implementation of statutes, regulations or policies, could affect us in substantial and unpredictable ways.

Such changes could subject us to additional costs, limit the types of financial services and products it may offer and/or increase the ability of non-banks to offer competing financial services and products, among other things.

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changes could subject us to additional costs, limit the types of financial services and products it may offer and/or increase the ability of non-banks to offer competing financial services and products, among other things.

Failure to comply with laws, regulations or policies could result in sanctions by regulatory agencies, civil money penalties and/or reputation damage, which could have a material adverse effect on our business, financial condition and results of operations.

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Our investment adviser and broker-dealer subsidiaries are subject to regulation by the SEC and FINRA.

We offer investment management services through SoFi Wealth, an internet based investment adviser, and SoFi Capital Advisors, which sponsors private investment funds that invest in asset-backed securitizations.

Both SoFi Wealth and SoFi Capital Advisors (collectively, the “Investment Advisers”) are registered as investment advisers under the Investment

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Advisers Act of 1940, as amended (the “Advisers Act”), which does not imply any level of skill or training, and are subject to regulation by the SEC.

We offer investment management services through SoFi Wealth which sponsors private investment funds that invest in asset-backed securitizations.

SoFi Wealth (the “Investment Adviser”) is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), which does not imply any level of skill or training, and is subject to regulation by the SEC.

SoFi Securities is an affiliated SEC-registered broker-dealer and FINRA member.

We offer cash management accounts, which are brokerage products, through SoFi Securities.

The Investment Advisers operate in a highly regulated environment and are subject to, among other things, the anti-fraud provisions of the Advisers Act and to fiduciary duties derived from these provisions, which apply to their relationships with our members who are their advisory clients, as well as the funds managed by the Investment Advisers.

The Investment Adviser operates in a highly regulated environment and is subject to, among other things, the anti-fraud provisions of the Advisers Act and to fiduciary duties derived from these provisions that apply to its relationships with our members who are its advisory clients, as well as the funds managed by the Investment Adviser.

These provisions and duties also impose certain restrictions and obligations on us with respect to our dealings with our members, fund investors and our investments, including for example restrictions on transactions with our affiliates.

Our Investment Advisers are also subject to other requirements under the Advisers Act and related regulations.

These additional requirements relate to matters including, among others, maintaining effective and comprehensive compliance programs, record-keeping and reporting and disclosure requirements.

Further, in 2022 and 2023, the SEC proposed numerous amendments to the Advisers Act rules, which are likely to present a number of additional significant and burdensome compliance challenges for registered investment advisers.

In addition, our Investment Advisers have been in the past, and will be in the future, subject to SEC examination.

Our Investment Adviser is also subject to other requirements under the Advisers Act and related regulations.

These additional requirements relate to matters including, among others, maintaining an effective and comprehensive compliance programs and record-keeping and reporting and disclosure requirements.

In recent years, the SEC proposed and, in some cases, adopted amendments to the Advisers Act rules, which present a number of additional significant and burdensome compliance challenges for registered investment advisers.

In addition, our Investment Adviser has been in the past, and will be in the future, subject to SEC examination.

Moreover, the Advisers Act generally grants the SEC broad administrative powers, including the power to limit or restrict an investment adviser from conducting advisory activities in the event it fails to comply with federal securities laws.

The investment advisers are also subject to applicable state securities laws.

Additional sanctions that may be imposed for failure to comply with applicable requirements include the prohibition of individuals from associating with an investment adviser, the revocation of registrations and other censures and fines.

The Investment Adviser is also subject to applicable state securities laws.

Additional sanctions that may be imposed for failure to comply with applicable requirements include prohibitions of individuals from associating with an investment adviser, the revocation of registration and other censures and fines.

Even if an investigation or proceeding did not result in a sanction or the sanction imposed against us or our personnel by a regulator was small in monetary amount, the adverse publicity relating to the investigation, proceeding or imposition of these sanctions could harm our reputation and cause us to lose existing members or fail to gain new members.

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Additionally, material expansions of the business in which SoFi Securities engages are subject to approval by FINRA.

This could delay, or even prevent, the firm’s ability to expand its securities and brokerage offerings in the future.

From time to time, SoFi Securities and the Investment Advisers may be threatened with or named as a defendant in lawsuits, arbitrations and administrative claims.

This could delay, or even prevent, the firm’s ability to expand its securities and brokerage offerings in the

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Furthermore, SoFi Securities is subject to increased governance in its role as an affiliate of a national bank under guidance from the OCC regarding RNDIPs.

OCC guidance, which was further updated in June 2024, requires that banks implement effective oversight and monitoring of relevant RNDIP arrangements to ensure that, among other things, sales transactions and recommendations to retail investors comply with SEC regulations.

Such oversight and monitoring may increase costs for SoFi Securities and SoFi Bank and could have a material adverse effect on our business, financial condition and results of operations, and any failure by SoFi Bank to effectively oversee and monitor such arrangements could result in harm to members and financial and reputational harm to us.

From time to time, SoFi Securities and the Investment Adviser may be threatened with or named as a defendant in lawsuits, arbitrations and administrative claims.

As previously noted, these entities are also subject to regulatory examinations and inspections by regulators (including the SEC and FINRA, as applicable).

Compliance and trading problems or other deficiencies or weaknesses that are reported to regulators, such as the SEC and FINRA, by dissatisfied members or others, or that are identified by regulators themselves are investigated by such regulators, and may, if pursued, result in formal claims being filed against SoFi Securities and the Investment Advisers by members or disciplinary action being taken by regulators against us or our personnel.

Compliance and trading problems or other deficiencies or weaknesses that are reported to regulators, such as the SEC and FINRA, by dissatisfied members or others, or that are identified by regulators themselves are investigated by such regulators, and may, if pursued, result in formal claims being filed against SoFi Securities and the Investment Adviser by members or disciplinary action being taken by regulators against us or our personnel.

Our failure to comply with applicable laws or regulations or our own policies and procedures could result in fines, litigation, suspensions of personnel or other sanctions, which could have a material effect on our overall financial results.

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Even if a sanction imposed against us or our personnel is small in monetary amount, the adverse publicity arising from the imposition of sanctions against us by regulators could harm our reputation and our brand and lead to material legal, regulatory and financial exposure (including fines and other penalties), cause us to lose existing members or fail to gain new members.

In addition, in the normal course of business, SoFi Securities and the Investment Advisers discuss matters raised by its regulators during regulatory examinations or otherwise upon their inquiry.

In addition, in the normal course of business, SoFi Securities and the Investment Adviser discuss matters raised by its regulators during regulatory examinations or otherwise upon their inquiry.

These matters could also result in censures, fines, penalties or other sanctions.

In addition to the broker-dealer proposals described above under “ Changes in applicable laws and regulations, as well as changes in government enforcement policies and priorities, may negatively impact the management of our business, results of operations, ability to offer certain products or the terms and conditions upon which they are offered, and ability to compete ”, a substantial number of proposed rules for investment advisers were introduced in 2023 and may be adopted this year.

These proposals cover material regulatory topics, including:

(i) environmental, social, and governance issues for investment advisers and registered investment companies;

(i) environmental, social, and governance issues for investment advisers and funds;

(ii) outsourcing by investment advisers;

and (iii) safeguarding and custody of client assets.

(iii) safeguarding and custody of client assets;

and (iv) expansion of the scope of activities and relationships that make a person an investment advice fiduciary under Section 3(21) of the Employee Retirement Income Security Act of 1974 and Section 4975 of the Internal Revenue Code.

If enacted, compliance with each of these proposed rules would impose additional costs on our business.

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This risk is substantially elevated where regulators adopt a substantial number of new rules in a short time frame.

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We recently transferred our digital assets-related trading services to comply with regulations governing bank holding companies;

We transferred our digital assets-related trading services to comply with regulations governing bank holding companies;

this transfer could adversely impact our member relationships and our reputation.

Until recently, we offered virtual currency and digital asset-related trading services through SoFi Digital Assets, LLC, a subsidiary licensed and registered with various governmental authorities as a MSB, money transmitter, virtual currency business or the equivalent.

Until early 2024, we offered virtual currency and digital asset-related trading services through SoFi Digital Assets, LLC, a subsidiary licensed and registered with various governmental authorities as a MSB, money transmitter, virtual currency business or the equivalent.

In connection with our approval as a bank holding company in February 2022, the Federal Reserve determined that SoFi Digital Assets, LLC was engaged in certain digital asset-related activities that the Federal Reserve has not found to be permissible for a bank holding company under the Bank Holding Company Act and Regulation Y.

Section 4(a)(2) of the Bank Holding Company Act permitted us to continue our digital assets related offering for a two-year conformance period from the date we became a bank holding company.

In compliance with the requirement that we conform our activities to those permissible for a bank holding company, in December 2023, we ceased offering digital-asset related trading services in all states except New York.

In compliance with the requirement that we conform our activities to those permissible for a bank holding company, by the end of January 2024, we ceased offering digital-asset related trading services in all states.

We provided a majority of our members with the option to either close their digital asset account or migrate their digital assets accounts to Blockchain.com.

Members located in New York were not eligible for account migration, so those member accounts remained open for sell orders only until January 28, 2024, following which any open New York accounts were closed.

All transaction fees from any sales from digital assets accounts will be reimbursed.

All transaction fees from any sales from digital assets accounts were reimbursed.

As part of our transfer of our digital asset-related activities we entered into a referral arrangement with Blockchain.com, and we have and may continue to enter into additional referral arrangements with other companies that can provide digital-asset related trading services to our members.

Although we do not expect the transfer of our digital asset-related activities or entry into the referral arrangements to have a material adverse impact on our business, results of operation or financial results, we cannot guarantee that our members will not experience a negative impact with respect to their digital asset positions.

In addition, these are recent events and there is no guarantee we will not face member dissatisfaction or litigation, or harm to our reputation, or adverse regulatory consequences, from such developments.

Furthermore, there is no guarantee we will not face member dissatisfaction or litigation, or harm to our reputation, or adverse regulatory consequences, from such transfer of digital assets-related trading services.

Furthermore, if our prior digital asset-related trading services are the subject of regulatory scrutiny or enforcement actions, it could have a material adverse effect on our business, results of operations and reputation.

There has been a significant amount of guidance, reports, and public statements issued by federal and state financial regulators regarding the legal permissibility of, and supervisory considerations relating to, financial institutions engaging in digital assets-related activities.

There has been a significant

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amount of guidance, reports, and public statements issued by federal and state financial regulators regarding the legal permissibility of, and supervisory considerations relating to, financial institutions engaging in digital assets-related activities.

regulators, including the SEC, FinCEN, the CFTC, the IRS, and state regulators including the New York State Department of Financial Services, have made official pronouncements, pursued cases against businesses in the digital assets space or issued guidance or rules regarding the treatment of Bitcoin and other digital currencies.

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and many state agencies have offered little or incomplete official guidance regarding the treatment of digital assets.

For example, the CFTC has publicly taken the position that certain virtual currencies, which term includes digital assets, are commodities.

Senior SEC staff members have created additional ambiguity about certain digital assets, including Ether, by refusing to affirmatively state whether they are “commodities” subject to CFTC jurisdiction or “securities” subject to SEC jurisdiction.

In addition, in 2023, the SEC brought high profile enforcement actions against companies that intermediate transactions in digital assets.

For example, in June 2023, the SEC filed lawsuits against cryptocurrency exchanges Coinbase and Binance Holdings Limited and its affiliate BAM Trading Services Inc.

(collectively, “Binance”) alleging, among other allegations, that Coinbase operated its crypto trading platform as an unregistered national securities exchange, broker and clearing agency and for its failure to register the offer and sale of its crypto asset staking-as-a-service program.

The SEC alleges that Binance was operating unregistered national exchanges, broker-dealers and clearing agencies and the unregistered offer and sale of crypto assets.

If the SEC or another federal or state regulator alleges that any assets we offered are securities or that we have violated any other federal or state securities law or regulation, we could face potential liability, including an enforcement action or private class action lawsuits, and face the costs of defending ourselves in the action, including potential fines, penalties, reputation harm, and potential loss of revenue.

If the SEC, CFTC or another federal or state regulator alleges that any assets we offered were securities or derivatives, or that we have violated any other federal or state securities or commodities law or regulation, we could face potential liability, including an enforcement action or private class action lawsuits, and face the costs of defending ourselves in the action, including potential fines, penalties, reputation harm, and potential loss of revenue.

See “ We may become subject to enforcement actions or litigation as a result of our failure to comply with laws and regulations, even though noncompliance was inadvertent or unintentional ”.

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State regulators may impose similar requirements on licensed money transmitters.

In addition, our contracts with financial institution partners and other third parties may contractually require us to maintain an anti-money

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laundering program.

In addition, our contracts with financial institution partners and other third parties may contractually require us to maintain an anti-money laundering program.

SoFi Bank is subject to the regulatory and supervisory jurisdiction of the OCC with respect to the BSA and its implementing regulations applicable to banks.

Our subsidiary, SoFi Digital Assets, LLC, is registered with FinCEN as an MSB.

Our subsidiary, SoFi Digital Assets, LLC, remains registered with FinCEN as an MSB.

Registration as an MSB subjects us to the regulatory and supervisory jurisdiction of FinCEN and the IRS, the anti-money laundering provisions of the BSA and its implementing regulations applicable to MSBs.

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We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities.

The failure to comply with any such laws could subject us to criminal or civil liability, cause us significant reputational harm and have an adverse effect on our business, financial condition and results of operations.

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failure to comply with any such laws could subject us to criminal or civil liability, cause us significant reputational harm and have an adverse effect on our business, financial condition and results of operations.

We conduct our business operations through subsidiaries and may in the future rely on dividends from our subsidiaries for a substantial amount of our cash flows.

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Compliance with these rules may impede our ability to receive dividends, distributions and other payments from SoFi Securities and SoFi Bank.

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We have in the past, continue to be, and may in the future be subject to inquiries, exams, pending investigations, or enforcement matters.

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Compliance and trading problems or other deficiencies or weaknesses that are reported to regulators, such as the OCC, SEC, FINRA, the CFPB or state regulators, by dissatisfied customers or others, or that are identified by regulators themselves, are investigated by such regulators, and may, if pursued, result in formal claims being filed against us by customers or disciplinary action being taken against us or our employees by regulators or enforcement agencies.

In addition, we could be required to disclose such federal, state, or local government actions or court orders to the CFPB’s registry of corporate offenders that have broken consumer laws, which could be time-consuming and costly, increase our legal and compliance costs, increase demand on our systems and resources, and adversely impact our reputation.

To resolve issues raised in examinations or other governmental actions, we may be required to take various corrective actions, including changing certain business practices, making refunds or taking other actions that could be financially or competitively detrimental to us.

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As a result, the outcome of legal and regulatory actions arising out of any state or federal inquiries we receive could have a material adverse effect on our business, financial condition or results of operations.

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Lawmakers, regulators and other public officials have signaled an increased focus on new or additional laws or regulations that could impact our broker-dealer business and require us to make significant changes to our business model and practices and could result in significant costs to our business or loss of current revenue streams.

Various lawmakers, regulators and other public officials have recently made statements about business practices in which we and other broker-dealers engage, including SoFi Securities, and signaled an increased focus on new or additional laws or regulations that, if acted upon, could impact our business.

Various lawmakers, regulators and other public officials have made statements about business practices in which we and other broker-dealers engage, including SoFi Securities, and signaled potential new or additional laws or regulations that, if acted upon, could impact our business.

For example, a focus by regulators and lawmakers on PFOF, exchange rebates, and related conflicts of interest have resulted in new proposed rules.

Additionally, the SEC has proposed new requirements regarding best execution (Regulation Best Execution), PFOF and a rule to prohibit volume-based transaction pricing in connection with the execution of agency-related orders in national market system stock.

The SEC also issued an order in September 2023 directing the equity exchanges and FINRA to file a new national marketing system plan.

The SEC also issued an order in September 2023 directing the equity exchanges and FINRA to file a new national marketing system plan and the SEC is soliciting comments on the proposed national marketing system plan.

This order and other proposals have the potential to substantially reshape U.S.

equities markets in intended and unintended ways, and to substantially alter existing order routing, execution incentives and business practices.

The SEC also finalized rules in February 2023 to shorten the standard settlement cycle for most broker-dealer transactions in securities from two business days after the trade (T+2) to one (T+1).

The SEC compliance date for T+1 is in May 2024 and this change has required and will continue to require technological, operational, and compliance adjustments across the industry that are likely to be time consuming and costly for all market participants.

Additionally, a focus by lawmakers and regulators on so-called gamification and digital engagement practices has resulted in a new rule proposed by the SEC and, in July 2023, the SEC proposed new rules and amendments to address certain conflicts of interest associated with the use of predictive data analytics by broker-dealers and investment advisers in investor interactions.

A Fall 2023 SEC rulemaking agenda indicates that adoptions of these proposed rules are likely.

To the extent that the SEC, FINRA or other regulatory authorities or legislative bodies adopt additional regulations or legislation in respect of any of these areas or relating to any other aspect of our business, we could face a heightened risk of potential regulatory violations and could be required to make significant changes to our business model and practices, which changes may not be successful.

Any of these outcomes could have an adverse effect on our business, financial condition and results of operations.

Additionally, any negative publicity surrounding PFOF practices generally, or our implementation of this

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practice, could harm our brand and reputation.

Additionally, any negative publicity surrounding PFOF practices generally, or our implementation of this practice, could harm our brand and reputation.

For more information about the potential impact of legal and regulatory changes, see “ We may become subject to enforcement actions or litigation as a result of our failure to comply with laws and regulations, even though noncompliance was inadvertent or unintentional ”.

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New requirements, originating from new or amended laws, could also increase our costs of compliance and business operations and could reduce income from certain business initiatives.

The CFPB, for example, finalized its Personal Financial Data Rights Rule, which could require us to build an application that allows our customers to obtain their personal financial information and for authorized third parties to obtain our customers’ information.

This could increase our compliance costs, volatility in our customer base, and the risk of fraudulent access to consumers’ personal financial information.

Compliance with current or future privacy, information security and data protection laws (including those regarding security breach notification) affecting customer and/or employee data to which we are subject could result in higher compliance and technology costs and could restrict our ability to provide certain products and services (such as products or services that involve sharing information with third parties or storing sensitive credit card information), which could materially and adversely affect our profitability.

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Furthermore, if our vendors and/or service providers are or become subject to laws and regulations in the jurisdictions that have enacted more stringent and expansive legislation applicable to privacy, information and/or data protection, the costs that these vendors and service providers must incur in becoming compliant may be passed along to us, resulting in increasing costs on our business.

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Concerns in our ability, perceived or otherwise, to protect the privacy and security of personal information may affect our ability to retain and engage new and existing members, clients, investors, and employees, and thereby affect our financial condition.

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Our failure to comply with privacy, information security and data protection laws could result in potentially significant regulatory investigations and government actions, litigation, fines or sanctions, consumer or merchant actions and damage to our reputation and brand, all of which could have a material adverse effect on our business.

Should we undertake an international expansion of our business, particularly if we commence doing business in one or more countries of the EU or the United Kingdom (the “UK”), we will be required to comply with stringent privacy and data protection laws.

Within the EU, legislators have adopted the General Data Protection Regulation (the “GDPR”), which became effective in May 2018.

Should we commence doing business in Europe, the GDPR will impose additional obligations and risk upon our business, which may increase substantially the penalties to which we could be subject in the event of any noncompliance.

We may incur substantial expense in complying with obligations imposed by the GDPR and we may be required to make significant changes in our business operations, all of which may adversely affect our revenues and our business overall.

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In addition, further to the UK’s exit from the EU on January 31, 2020, the GDPR ceased to apply in the UK at the end of the transition period on December 31, 2020.

If we collect and process personal data relating to individuals in the EU or the United Kingdom (the “UK”) as a result of either offering goods or services into the EU or UK, or monitoring the behavior of EU and UK individuals, we will be required to comply with stringent privacy and data protection laws.

Within the EU, legislators have adopted the General Data Protection Regulation (the “EU GDPR”), which became effective in May 2018.

The EU GDPR will impose additional obligations and risks upon our business when we collect and process personal data about individuals from the EU and UK, which may increase substantially the penalties to which we could be subject in the event of any noncompliance.

For example, the EU GDPR imposes a broad range of strict requirements on companies subject to the EU GDPR, including requirements relating to having legal bases and conditions for processing personal data and transferring such personal data outside the European Economic Area (“EEA”) or the UK, including to the U.S., providing details to those individuals regarding the processing of their personal data, keeping personal data secure, having data processing agreements with third parties who process personal data, responding to individuals’ requests to exercise their rights in respect of their personal data, where required reporting security breaches involving personal data to the competent national data protection authority and affected individuals, where required, appointing data protection officers, where required conducting data protection impact assessments for high risk processing, and record-keeping.

We may incur substantial expense in complying with obligations imposed by the EU GDPR and we may be required to make significant changes in our business operations, all of which may adversely affect our revenues and our business overall.

In addition, further to the UK’s exit from the EU on January 31, 2020, the EU GDPR ceased to apply in the UK at the end of the transition period on December 31, 2020.

However, as of January 1, 2021, the UK’s European Union (Withdrawal) Act 2018 incorporated the GDPR (as it existed on December 31, 2020 but subject to certain UK specific amendments) into UK law, referred to as the “UK GDPR”.

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Noncompliance with the UK GDPR may result in significant monetary penalties.

Although the UK is regarded as a third country under the EU’s GDPR, the EC has issued a decision recognizing the UK as providing adequate protection under the EU GDPR and, therefore, transfers of personal data originating in the EU to the UK remain unrestricted.

Although the UK is regarded as a third country under the EU GDPR, the EC has issued a decision recognizing the UK as providing adequate protection under the EU GDPR and, therefore, transfers of personal data originating in the EU to the UK remain unrestricted.

The UK Government introduced a Data Protection and Digital Information Bill which failed in the UK legislative process.

A new Data (Use and Access) Bill (“UK Bill”) has been introduced into parliament.

If passed, the final version of the UK Bill may have the effect of further altering the similarities between the UK and EEA data protection regime and threaten the UK Adequacy Decision from the EC.

Further, this may lead to additional compliance costs and could increase our overall risk.

Like the EU GDPR, the UK GDPR restricts personal data transfers outside the UK to countries not regarded by the UK as providing adequate protection.

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Additional jurisdictions with stringent data protection laws include Brazil and China.

In the United States, the SEC proposed multiple rules related to privacy and cybersecurity in March 2023.

Proposed amendments to Regulation S-P would, among other things:

While we believe we have robust policies and procedures addressing incidents involving unauthorized access to or use of customer information, these regulations have and may in the future require us to amend our current incident response program.

In addition, these regulations may interfere with our intended business activities, inhibit our ability to expand into those markets or prohibit us from continuing to offer services in those markets without significant additional costs.

The regulatory framework governing the collection, processing, storage, use and sharing of certain information, particularly financial and other personal information, is rapidly evolving and is likely to continue to be subject to uncertainty and varying interpretations.

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We therefore cannot yet fully determine the impact existing and/or future laws, rules, regulations and industry standards may have on our business or operations.

Any failure or perceived failure by us, or any third parties with which we do business, to comply with our posted privacy policies, changing consumer expectations, evolving laws, rules and regulations, industry standards, or contractual obligations to which we or such third parties are or may become subject, may result in actions or other claims against us by governmental entities or private actors, the expenditure of substantial costs, time and other resources or the imposition of significant fines, penalties or other liabilities.

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industry standards, or contractual obligations to which we or such third parties are or may become subject, may result in actions or other claims against us by governmental entities or private actors, the expenditure of substantial costs, time and other resources or the imposition of significant fines, penalties or other liabilities.

In addition, any such action, particularly to the extent we were found to be guilty of violations or otherwise liable for damages, would damage our reputation and adversely affect our business, financial condition and results of operations.

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Although we endeavor to comply with our published policies and documentation, we may at times fail to do so or be alleged to have failed to do so.

Any failure or perceived failure by us to comply with our privacy policies or any applicable privacy, security or data protection, information security or consumer-protection related laws, regulations, orders or industry standards could expose us to costly litigation, significant awards, fines or judgments, civil and/or criminal penalties or negative

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publicity, and could materially and adversely affect our business, financial condition and results of operations.

The publication of our privacy policy and other documentation that provide promises and assurances about privacy and security can subject us to potential state and federal action if they are found to be deceptive, unfair, or misrepresentative of our actual practices, which could, individually or in the aggregate, materially and adversely affect our business, financial condition and results of operations.

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If portions of our proprietary platform are determined to be subject to an open source license, or if the license terms for the open source software that we incorporate change, we could be required to publicly release the affected portions of our source code, re-engineer all or a portion of our platform or change our business activities.

In addition to risks related to license requirements, the use of open source software can lead to greater risks than the use of third-party commercial software, as open source licensors generally do not provide warranties or controls on the origin of the software.

In addition to risks related to license requirements, the use of open source software can lead to greater

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risks than the use of third-party commercial software, as open source licensors generally do not provide warranties or controls on the origin of the software.

Many of the risks associated with the use of open source software cannot be eliminated and could adversely affect our business.

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See “ If we fail to comply with federal and state consumer protection laws, rules, regulations and guidance, our business could be adversely affected ” for a discussion of the FTC Consent Order.

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In addition, a number of participants in the financial services industry have been the subject of:

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In addition, as a financial services company, errors in performing settlement functions, including clerical, technological and other errors related to the handling of funds and securities could lead to censures, fines or other sanctions imposed by applicable regulatory authorities as well as losses and liabilities in related lawsuits and proceedings brought by transaction counterparties and others.

The current regulatory environment, increased regulatory compliance efforts and enhanced regulatory enforcement have resulted in significant operational and compliance costs and may prevent us from providing certain products and services.

The environment of increased regulatory compliance efforts and enhanced regulatory enforcement in the past few years has resulted in significant operational and compliance costs and may prevent us from providing certain products and services.

There is no assurance that these regulatory matters or other factors will not, in the future, affect how we conduct our business and, in turn, have a material adverse effect on our business.

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The differences in treatment may result in payment of additional taxes, interest or penalties that could have an adverse effect on our financial condition and results of operations.

Further, future changes to U.S.

Further, future

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changes to U.S.

federal, state and local and non-U.S.

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Several of the proposals currently being considered, if enacted, could have an adverse impact on our future effective tax rate, income tax expense, and cash flows.

Further, the Organisation for Economic Co-operation and Development (the “OECD”), an international association of 38 countries, including the U.S., has issued guidelines that change long-standing tax principles.

Further, the Organisation for Economic Co-operation and Development (the “OECD”) has issued guidelines that change long-standing tax principles and certain countries have adopted OECD guidelines.

These guidelines create tax uncertainty as countries amend their tax laws to adopt certain parts of the guidelines.

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(ii) we could be sued by investors in us and in our securities for damages caused by the violation;

and (iii) any contract to which we are a party that is made in, or

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whose performance involves a, violation of the Investment Company Act would be unenforceable by any party to the contract unless a court were to find that under the circumstances enforcement would produce a more equitable result than nonenforcement and would not be inconsistent with the purposes of the Investment Company Act.

and (iii) any contract to which we are a party that is made in, or whose performance involves a, violation of the Investment Company Act would be unenforceable by any party to the contract unless a court were to find that under the circumstances enforcement would produce a more equitable result than nonenforcement and would not be inconsistent with the purposes of the Investment Company Act.

Should we be subjected to any or all of the foregoing, our business would be materially and adversely affected.

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In addition, the loss of any of our senior management or key employees could materially adversely affect our ability to execute our business plan and strategy, and we may not be able to find adequate replacements on a timely basis, or at all, and our other employees may be required to take on additional responsibilities.

Furthermore, many candidates evaluate year over year stock growth trends for a sense of the potential long-term value of their proposed stock awards, or have recently begun to discount the value of growth stocks on the whole.

Furthermore, many candidates evaluate year over year stock growth trends for a sense of the potential long-term value of their proposed stock awards.

The volatility of the market price of our common stock could harm our ability to attract and retain talent.

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Turnover can result in significant replacement costs and lost productivity.

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In addition, from time to time, we implement organizational changes to pursue greater efficiency and realign our business and strategic priorities.

For example, in the recent past, we laid off a relatively small number of employees even though we intend to continue to hire in other areas.

For example, in the past, we laid off a relatively small number of employees even though we intend to continue to hire in other areas.

As our organization continues to evolve, and we are required to implement and optimize our business and organizational structures, we may find it difficult to maintain the benefits of our corporate culture, including our ability to quickly develop and launch new and innovative products.

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For example, our employees are accessing our servers remotely through home or other networks to perform their job responsibilities.

Such security systems may be less secure than those used in our offices, which may subject us to

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increased security risks, including cybersecurity-related events, and expose us to risks of data or financial loss and associated disruptions to our business operations.

Such security systems may be less secure than those used in our offices, which may subject us to increased security risks, including cybersecurity-related events, and expose us to risks of data or financial loss and associated disruptions to our business operations.

Additionally, employees who access company data and systems remotely may not have access to technology that is as robust as that in our offices, which could place additional pressure on our user infrastructure and third parties that are not easily mitigated.

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Terrorism, cyberattacks and other criminal, tortious or unintentional actions could also give rise to significant disruptions to our operations.

In addition, the long-term effects of climate change on the global economy and our industry in particular are unclear, however we recognize that there are inherent climate-related risks wherever business is conducted.

In addition, the long-term effects of climate change on the global economy and our industry in particular are unclear, however we recognize that there are inherent

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climate-related risks wherever business is conducted.

For example, our offices may be vulnerable to the adverse effects of climate change.

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• concealing unauthorized or unsuccessful activities;

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• otherwise not complying with applicable laws and regulations or our internal policies or procedures.

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The annual internal control assessment required by Section 404 of Sarbanes-Oxley has diverted, and may in the future divert, internal resources and we have and may experience higher operating expenses, higher independent auditor and consulting fees in the future.

To comply with the Sarbanes-Oxley Act, the requirements of being a reporting company under the Exchange Act and any new or revised accounting rules in the future, as necessary, we have, and may in the future further, work to upgrade SoFi’s legacy information technology systems;

implement additional financial and management controls, reporting systems and procedures;

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If we are unable to hire the additional accounting and finance staff necessary to comply with these requirements, we may need to retain additional outside consultants.

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In addition, our current controls and any new controls that we develop may become inadequate because of poor design and changes in our business.

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We cannot assure you that there will not be additional material weaknesses in our internal control over financial reporting now or in the future.

For example, as the accounting acquirer in the Business Combination, we inherited a material weakness from SCH related to the treatment of warrants issued by special acquisition companies which required SCH to restate its previously issued audited financial statements as of December 31, 2020.

Any failure to maintain internal control over financial reporting could cause us to fail to timely detect errors and severely inhibit our ability to accurately report our financial condition, results of operations or cash flows.

If we are unable to conclude that our internal control over financial reporting is

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effective, or if our independent registered public accounting firm determines that we have a material weakness in our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines that we have a material weakness in our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities.

Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.

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A change in these principles or interpretations could have a significant effect on our reported financial results and could affect the reporting of transactions completed before the announcement of a change.

Our management has limited experience in operating a public company.

We have incurred and will continue to incur increased costs as a result of operating as a public company, and our management intends to continue to devote substantial time to new compliance initiatives.

We incur significant costs and expend significant time and effort, as a result of operating as a public company, and our management is required to devote substantial time to compliance initiatives and corporate governance practices.

We have incurred and will continue to incur increased costs as a result of operating as a public company, and our management intends to continue to devote substantial time to new risk management and compliance initiatives.

As a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Act, as well as rules adopted, and to be adopted, by the SEC and Nasdaq.

Our management and other personnel devote and we expect will continue to devote a substantial amount of time to these compliance initiatives.

Furthermore, new rules and regulations or changes to existing rules and regulations in the future may increase our legal and financial compliance costs and make some activities more time-consuming and costly, which would increase our net loss for the foreseeable future.

Our management and other personnel devote a substantial

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amount of time to these risk management and compliance initiatives.

The impact of these requirements could also make it more difficult for us to attract and retain qualified persons to serve on our Board of Directors, its board committees or as executive officers.

Our executive officers have limited experience in dealing with the increasingly complex laws pertaining to public companies, which may increase the amount of their time devoted to these activities and result in less time being devoted to the management and growth of the business.

Dealing with the increasingly complex laws pertaining to public companies can be time consuming, which may result in our executive officers devoting less time to the management and growth of the business.

We continue to evaluate whether we have adequate personnel with the appropriate level of knowledge, experience and training in the accounting policies, practices or internal control over financial reporting required of public companies.

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See “ If we fail to establish and maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline ”.

As a result of our business combination with a special purpose acquisition company, regulatory obligations may impact us differently than other publicly traded companies.

We became a publicly traded company by completing a transaction with SCH, a SPAC.

As a result of this transaction, regulatory obligations have, and may continue, to impact us differently than other publicly traded companies.

For instance, the SEC and other regulatory agencies may issue additional guidance or apply further regulatory scrutiny to companies like us that have completed a business combination with a SPAC.

Managing this regulatory environment, which has and may continue to

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evolve, could divert management’s attention from the operation of our business, negatively impact our ability to raise additional capital when needed or have an adverse effect on the price of our common stock.

Our risk management processes and procedures may not be effective.

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Strategic risk is the risk from changes in the business environment, ineffective business strategies, improper implementation of decisions or inadequate responsiveness to changes in the business and competitive environment.

Operational risk is the risk of loss arising from inadequate or failed internal processes, controls, people (e.g., human error or misconduct) or systems ( e.g.

, technology problems), business continuity or external events (e.g., natural disasters), compliance, reputational, regulatory, or legal matters and includes those risks as they relate directly to us, fraud losses attributed to applications and any associated fines and monetary penalties as a result, transaction processing, or employees, as well as to third parties with whom we contract or otherwise do business.

Operational risk is the risk of loss arising from inadequate or failed internal processes, controls, people (e.g., human error or misconduct) or systems (e.g., technology problems), business continuity or external events (e.g., natural disasters), compliance, reputational, regulatory, cybersecurity or legal matters and includes those risks as they relate directly to us, fraud losses attributed to applications and any associated fines and monetary penalties as a result, transaction processing, or employees, as well as to third parties with whom we contract or otherwise do business.

We believe operational risk is one of the most prevalent forms of risk in our risk profile.

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In order to be effective, among other things, our enterprise risk management capabilities must adapt and align to support any new product or loan features, capability, strategic development, or external change.

Cybersecurity risk is the risk of a malicious technological attack intended to impact the confidentiality, availability, or integrity of our systems and data, including, but not limited to, sensitive client data.

Cybersecurity risk is the risk of an unauthorized occurrence on or conducted through our information systems that may result in adverse effects on the confidentiality, availability, or integrity of our systems and data, including, but not limited to, sensitive client data.

Our technology and cybersecurity teams rely on a layered system of preventive and detective technologies, controls, and policies to detect, mitigate, and contain cybersecurity threats.

In addition, our cybersecurity team, and the third-party consultants they engage, regularly assess our cybersecurity risks and mitigation efforts.

In addition, our cybersecurity team, and the third-party consultants they engage, assess our cybersecurity risks and mitigation efforts.

Cyberattacks can also result in financial and reputational risk.

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We attempt to manage this risk through our commitment to a set of core values that emphasize and reward high standards of ethical behavior, maintaining a culture of compliance, and by being responsive to member and regulatory requirements.

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Risk, including, but not limited to, the risks outlined above, is inherent in our business, and therefore, despite our efforts to manage risk, there can be no assurance that we will not sustain unexpected losses.

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If our risk management framework does not effectively identify and control our risks, we could suffer unexpected losses or be otherwise adversely affected, which could have a material adverse effect on our business.

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Incorrect estimates or assumptions by management in connection with the preparation of our consolidated financial statements or forecasts could adversely affect our reported or forecasted assets, liabilities, income, revenues or expenses.

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We may fail to meet our publicly announced guidance or other expectations about our business and future operating results, which could cause our stock price to decline.

From time to time, we release earnings guidance in our quarterly and annual earnings conference calls, quarterly and annual earnings releases, or otherwise, regarding our future performance that represents our management’s estimates as of the date of release.

On January 29, 2024, we provided guidance for the first quarter and full year 2024, as well as through 2026 and beyond.

We typically release earnings guidance in our quarterly and annual earnings conference calls and quarterly and annual earnings releases, and may, from time to time, announce guidance otherwise, regarding our future performance that represents our management’s estimates as of the date of release.

This guidance includes forward-looking statements based on projections prepared by our management.

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Information Technology and Data Risks

Cyberattacks and other security breaches could have an adverse effect on our business, harm our reputation and expose us to liability and adversely affect our ability to collect payments and maintain accurate accounts.

Efforts to prevent and respond to these attacks and breaches are costly.

Cyberattacks and other security incidents and compromises could have an adverse effect on our business, harm our reputation and expose us to liability and adversely affect our ability to collect payments and maintain accurate accounts.

Efforts to prevent and respond to these attacks and incidents are costly.

In the normal course of business, we collect, process and retain non-public and confidential information regarding our members, prospective members, technology platform clients and the customers of our technology platform clients.

We also have arrangements in place with certain third-party service providers that require us to share consumer information.

We likely will not be able to anticipate or prevent all security breaches even if we have implemented the required preventive measures, in which case there would be an increased risk of fraud or identity theft, and we have in the past and may in the future experience losses on, or delays in the collection of amounts owed.

Although we devote significant resources and management focus to work to ensure the integrity of our systems through information/cybersecurity and business continuity programs, our facilities and systems, and those of third-party service providers, have been and will likely continue to be targeted by external or internal threats, security breaches, acts of vandalism, including other intentional acts by employees or third-party service providers that we are unable to predict and protect against or that compromise our security systems, computer viruses, misplaced or lost data, programming or human errors, and other similar events.

In addition, the digital nature of our platform may make it lucrative for hacking and potentially vulnerable to computer viruses, physical or electronic break-ins and similar disruptions.

We likely will not be able to anticipate or prevent all security incidents or compromises even if we have implemented preventive measures, in which case there would be an increased risk of fraud or identity theft, and we have in the past and may

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We and third-party service providers have experienced such attempts in the past and expect to continue to experience them in the future.

Security breaches could occur from outside our company, and also from the actions of persons inside our company who may have authorized or unauthorized access to our technology systems, despite the required investment in security controls.

We also face security threats from malicious threat actors that could obtain unauthorized access to our systems and networks, which threats we anticipate will continue to grow in scope and complexity over time.

In addition, security threats may increase as a result of geopolitical events, such as in connection with the war between Israel and Hamas, and the ongoing war in Ukraine.

in the future experience losses on, or delays in the collection of amounts owed.

We and our third-party service providers are at constant risk of cyber-attacks or cyber intrusions via viruses, worms, break-ins, malware, ransomware and other malicious software programs, phishing attacks, hacking, denial-of-service attacks or other attacks and similar disruptions from the unauthorized use of or access to computer systems (including from internal and external sources) that attack our products or otherwise exploit any vulnerabilities in our systems or those of our third-party service providers, or attempt to fraudulently induce our members, prospective members, technology platform clients and the customers of our technology platform clients, third-party service providers or others to disclose passwords or other sensitive information or unwittingly provide access to our systems or data.

In addition, we expect the amount and sophistication of the perpetrators of these attacks to continue to expand, which could include nation-state actors.

Any such incident could lead to interruptions, delays or website outages, causing loss of critical data or the unauthorized disclosure or use of personally identifiable or other confidential information.

Cyberattacks continue to be prevalent and pervasive across industries, including in our industry, and such attacks on our systems and those of our third-party service providers have occurred in the past and are expected to occur in the future.

Security incidents or compromises could occur from outside our company, and also from the actions of persons inside our company who may have authorized or unauthorized access to our technology systems, despite our investment in security controls.

In addition, security threats may increase as a result of geopolitical events, such as in connection with escalating conflict in the Middle East and the ongoing war in Ukraine, and recent changes to the U.S.

presidential administration.

These events could interrupt our business or operations, result in significant legal and financial exposure, supervisory liability, damage to our reputation and a loss of confidence in the security of our systems, products and services.

Although the impact to date from these events has not had a material adverse effect on us, no assurance is given that this will continue to be the case in the future.

Cybersecurity risks in the financial services industry have increased, in part because of new technologies, the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized criminals, perpetrators of fraud, hackers, terrorists and others.

In addition to cyberattacks and other security breaches involving the theft of non-public and confidential information, hackers have engaged in attacks that are designed to disrupt key business services, such as consumer-facing websites.

We may not be able to anticipate or implement effective preventive measures against all security breaches, especially because the techniques used change frequently and because attacks can originate from a wide variety of sources.

Cybersecurity risks in the financial services industry have increased, in part because of new technologies, artificial intelligence, the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized criminals, perpetrators of fraud, hackers, terrorists and others.

In addition to cyberattacks and other security incidents and compromises involving the theft of non-public and confidential information, hackers have engaged in attacks that are designed to disrupt key business services, such as consumer-facing websites.

We may not be able to anticipate or implement effective preventive measures against all security incidents and compromises, especially because the techniques used change frequently and because attacks can originate from a wide variety of sources.

We employ detection and response mechanisms designed to contain and mitigate security incidents, but there are no assurances that these mechanisms will be effective and early detection efforts may be thwarted by sophisticated attacks and malware designed to avoid detection.

Despite our investments in detection strategy and a 24/7/365 security operations center, we also may fail to detect the existence of a security breach related to the information of our members.

Cybersecurity risks have also subjected us to additional regulation.

For example, in July 2023, the SEC proposed new rules and amendments to address certain conflicts of interest associated with the use of predictive data analytics by broker-dealers and investment advisers in investor interactions.

To the extent we determined there were conflicts of interest, we would be required to eliminate, or neutralize the effect of, any such conflicts.

The proposed rules would also require us to have written policies and procedures reasonably designed to achieve compliance with the proposed rules and to make and keep books and records related to these requirements.

Despite our investments in detection strategy and a 24/7/365 security operations center, we also may fail to detect the existence of a security incident related to the information of our members.

The access by unauthorized persons to, or the improper disclosure by us of, confidential information regarding our members, prospective members, technology platform clients and the customers of our technology platform clients, or our proprietary information, software, methodologies and business secrets could interrupt our business or operations, result in significant legal and financial exposure, supervisory liability, damage to our reputation or a loss of confidence in the security of our systems, products and services, all of which could have a material adverse impact on our business.

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Furthermore, any failure of our computer systems could cause an interruption in operations and result in disruptions in, or reductions in the amount of, collections from the loans we make to our members.

Additionally, if hackers were able to access our secure files, they might be able to gain access to the personal information of our members, prospective members, technology platform clients and the customers of our technology platform clients.

Additionally, if threat actors were able to access our secure files, they might be able to gain access to the personal information of our members, prospective members, technology platform clients and the customers of our technology platform clients.

If we are unable to prevent such activity, we may be subject to significant liability, negative publicity and a material loss of members or technology platform clients, all of which may negatively affect our business.

In addition, there have in the past been a number of well-publicized attacks or breaches affecting companies in the financial services industry that have heightened concern by consumers, which could also intensify regulatory focus, cause users to lose trust in the security of the industry in general and result in reduced use of our services and increased costs, all of which could also have a material adverse effect on our business.

The collection, processing, use, storage, sharing and transmission of personal data could give rise to liabilities as a result of federal, state and international laws and regulations, as well as our failure to adhere to the privacy and data security practices that we articulate to our members.

In addition, there have in the past been a number of well-publicized attacks or incidents affecting companies in the financial services industry that have heightened concern by consumers, which could also intensify regulatory focus, cause users to lose trust in the security of the industry in general and result in reduced use of our services and increased costs, all of which could also have a material adverse effect on our business.

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The processing of personal data and implementation of new technologies could give rise to liabilities as a result of federal, state and international laws and regulations, as well as our failure to adhere to the privacy and data security practices that we articulate to our members.

We collect, process, store, use, share and/or transmit a large volume of personal information and other non-public data from current, past and prospective members.

There are federal, state, and foreign laws regarding privacy, data security and the collection, use, storage, protection, sharing and/or transmission of personal information and non-public data.

Additionally,

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many states continue to enact legislation on matters of privacy, information security, cybersecurity, data breach and data breach notification requirements.

Additionally, many states continue to enact legislation on matters of privacy, information security, cybersecurity, data breach and data breach notification requirements.

For example, as of January 1, 2020, the CCPA granted additional consumer rights with respect to data privacy in California.

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However, the CCPA regulates other personal information that we collect and process in connection with the business.

While we have made modifications to our data collection and processing practices and policies to comply with the CCPA and CPRA, we cannot predict their impact on our business, operations or financial condition.

The effects of the CCPA and the CPRA are potentially significant and may require us to further modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.

Additionally, our broker-dealer and investment adviser are subject to SEC Regulation S-P, which requires that these businesses maintain policies and procedures addressing the protection of customer information and records.

This includes protecting against any anticipated threats or hazards to the security or integrity of customer records and information and against unauthorized access to or use of customer records or information.

Regulation S-P also requires these businesses to provide initial and annual privacy notices to customers describing information sharing policies and informing customers of their rights.

In March 2023, the SEC proposed multiple rules related to privacy and cybersecurity.

Proposed amendments to Regulation S-P would, among other things:

While we have made modifications to our data collection and processing practices and policies to comply with the CCPA, we cannot predict their impact on our business, operations or financial condition.

Laws similar to the CCPA have been passed in numerous other states, a number of which will enter into force in 2025.

Further, a number of other states have proposed new privacy laws, some of which would be comprehensive such as the CCPA and others which are more narrowly focused on particular types of data.

Such proposed legislation, if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.

The existence of comprehensive privacy laws in different states in the country would make our compliance obligations more complex and costly and may increase the likelihood that we may be subject to enforcement actions or otherwise incur liability for noncompliance.

In addition, laws in all 50 U.S.

states require businesses to provide notice to individuals if certain of their personal information has been disclosed as a result of a qualifying data breach.

These various privacy and security laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products.

State laws are changing rapidly and U.S.

Congress may in the future enact a comprehensive federal data privacy law to which we may likely become subject.

Outside the United States, an increasing number of laws, regulations, and industry standards apply to data privacy and security.

For example, the European Union’s General Data Protection Regulation (EU GDPR), the United Kingdom’s GDPR (UK GDPR), various Latin American (LATAM) privacy laws such as Brazil’s Lei Geral de Proteção de Dados Pessoais (LGPD) and Argentina’s Ley de Protección de los Datos Personales (PDPA) impose strict requirements for the processing of personal data of individuals located, respectively, within the European Economic Area (EEA), the United Kingdom (UK) and LATAM region.

For example, under the EU GDPR, government regulators may impose temporary or definitive bans on data processing, as well as fines of up to 20 million Euros or 4% of the annual global revenue of the company, whichever is greater;

For example, the EU GDPR, the UK GDPR, various Latin American (“LATAM”) privacy laws such as Brazil’s Lei Geral de Proteção de Dados Pessoais (“LGPD”) and Argentina’s Ley de Protección de los Datos Personales (“PDPA”) impose strict requirements for the processing of personal data of individuals located, respectively, within the EEA, the UK and LATAM region.

For example, under the EU GDPR, government regulators may impose temporary or definitive bans on data processing, as well as fines of up to 20 million Euros (£17.5 million in the UK) or 4% of the annual global revenue of the company, whichever is greater;

or private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests.

Certain jurisdictions, such as the EU, Switzerland, the UK and LATAM have enacted cross-border personal data transfers laws regulating personal data flows to third countries.

For example, absent appropriate safeguards or other circumstances, the EU GDPR generally restricts the transfer of personal data to countries outside of the EEA, such as the United States, which the European Commission does not consider to provide an adequate level of personal data protection.

The European Commission released a set of “Standard Contractual Clauses” that are designed to be a valid mechanism by which entities can transfer personal data out of the EEA to jurisdictions that the European Commission has not found to provide an adequate level of protection.

Currently, these Standard Contractual clauses are a valid mechanism to transfer personal data outside of the EEA.

The Standard Contractual Clauses, however, require parties that rely upon that legal mechanism to comply with additional obligations such as conducting transfer impact assessments to determine whether additional security measures are necessary to protect the at-issue personal data.

In addition, laws in Switzerland, the UK and LATAM similarly restrict personal data transfers outside of those jurisdictions to countries such as the United States of America that do not provide an adequate level of personal data protection.

In addition to European restrictions on cross-border personal data transfers, other jurisdictions have enacted or are considering similar cross-border personal data transfer laws and local personal data residency laws, any of which could increase the cost and complexity of doing business.

For example, absent appropriate safeguards or other circumstances, the EU GDPR generally restricts the transfer of personal data to countries outside of the EEA, such as the United States, which the European Commission does not consider to be providing an adequate level of personal data protection.

The European Commission has issued standard contractual clauses for data transfers from controllers or processors in the EU (or otherwise subject to the EU GDPR) to controllers or processors established outside the EU.

The standard contractual clauses require exporters to assess the risk of a data transfer on a case-by-case basis, including an analysis of the laws in the destination country.

The UK is not subject to the European Commission’s standard contractual clauses but has published a UK-specific transfer mechanism, which enables transfers from the UK.

The UK-specific mechanism, the “International Data Transfer Agreement”, requires a similar risk assessment of the transfer as the standard contractual clauses.

Further, the EU and United States have adopted its adequacy decision for the EU-U.S.

Data Privacy Framework ("Framework"), which entered into force on July 11, 2023.

This Framework provides that the protection of personal data transferred between the EU and the United States is comparable to that offered in the EU.

This provides a further avenue to ensuring transfers to the United States are carried out in line with the EU GDPR.

There has been an extension to the Framework to cover UK transfers to the United States.

The Framework could be challenged like its predecessor frameworks.

This complexity and the additional contractual burden may increase our overall risk exposure.

In addition, laws in Switzerland and LATAM similarly restrict personal data transfers outside of those jurisdictions to countries such as the United States of America that do not provide an adequate level of personal data protection.

In addition to European restrictions on cross-border personal data transfers, other jurisdictions have enacted or are considering similar cross-border personal data transfer laws and

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local personal data residency laws, any of which could increase the cost and complexity of doing business.

If we cannot implement a valid compliance mechanism for cross-border personal data transfers, we may face increased exposure to regulatory actions, substantial fines, and injunctions against processing or transferring personal data from Europe or elsewhere.

Inability to import personal data to the United States may significantly and negatively impact our business operations, including by limiting our ability to collaborate with parties subject to European and other data protection laws or requiring us to increase our personal data processing capabilities in Europe and/or elsewhere at significant expense.

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Separately, as the regulatory framework for machine learning technology and AI evolves, new state laws and regulations are emerging, such as the Colorado AI Act which will go into effect on February 1, 2026, and California’s AB 2013, which requires generative AI developers to post information on their websites regarding the data used to train their AI systems.

It is possible that other new laws and regulations will be adopted in the near future, or that existing laws and regulations may be interpreted in ways that would affect our business and the ways in which we may use AI and machine learning technology, our financial condition and our results of operations, including as a result of the cost to comply with such laws or regulations.

For example, the EU’s Artificial Intelligence Act (“AI Act”) - the world’s first comprehensive AI law - entered into force on August 1, 2024 and, with some exceptions, will begin to apply as of August 2, 2026.

This legislation imposes significant obligations on providers and deployers of high-risk artificial intelligence systems, and encourages providers and deployers of artificial intelligence systems to account for EU ethical principles in their development and use of these systems.

If we develop or use AI systems that are governed by the AI Act, it may necessitate ensuring higher standards of data quality, transparency, and human oversight, as well as adhering to specific ethical, accountability, and administrative requirements, some of which may increase our costs and compliance obligations.

Further, potential government regulation related to AI use and ethics may also increase the cost of research and development in this area, and failure to properly remediate AI usage or ethics issues may cause public confidence in AI to be undermined, which could slow adoption of AI in our products and services.

Any violations of these laws and regulations may require us to change our business practices or operational structure, including limiting our activities in certain states and/or jurisdictions, address legal claims, and sustain monetary penalties, reputational damage and/or other harms to our business.

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Any such events, including persistent interruptions or perceptions of such interruptions whether true or not, in our products and services could cause members to believe that our products and services are unreliable, leading them to switch to our competitors or to otherwise avoid our products and services, and otherwise have a negative effect on our business and technology infrastructure (including our computer network systems), which could lead to member dissatisfaction or long-term disruption of our operations.

Additionally, our insurance policies might be insufficient to cover a claim made against us by any such members affected by any disruptions, outages, or other performance or infrastructure problems.

Additionally, our insurance policies might be insufficient to

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cover a claim made against us by any such members affected by any disruptions, outages, or other performance or infrastructure problems.

Additionally, our reliance on third-party providers may mean that we will not be able to resolve operational problems internally or on a timely basis, as our operations will depend upon such third-party service providers communicating appropriately and responding swiftly to their own service disruptions through industry standard best practices in business continuity and/or disaster recovery.

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These systems may inadvertently reduce the efficiency of our systems, or may cause unintentional or unexpected outputs that are incorrect, do not match our business goals, do not comply with our policies, or otherwise are inconsistent with our brands, guiding principles and mission.

Errors or breakdowns in our machine learning

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systems could also result in damage to our reputation, loss of members, loss of revenue or liability for damages, any of which could adversely affect our growth prospects and our business.

Errors or breakdowns in our machine learning systems could also result in damage to our reputation, loss of members, loss of revenue or liability for damages, any of which could adversely affect our growth prospects and our business.

We expect that new technologies and business processes applicable to the financial services industry will continue to emerge and that these new technologies and business processes may be better than those we currently use.

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• commencement of, or involvement in, litigation or regulatory enforcement investigations involving our company;

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• changes in our capital structure, such as future issuances of securities or the incurrence of additional debt, including in connection with acquisitions;

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• volatility in capital markets and changes in the volume of shares of our common stock available for public sale;

• general economic and political conditions, such as the effects of recessions, interest rates, inflation, consumer confidence and spending, public perception of the financial services industry, availability of loans and liquidity in the capital markets, local and national elections, corruption, political instability and acts of war or terrorism, including the war between Israel and Hamas, and the ongoing war in Ukraine.

• general economic and political conditions, such as the effects of recessions, interest rates, tariffs, inflation, consumer confidence and spending, public perception of the financial services industry, availability of loans and liquidity in the capital markets, local and national elections, corruption, political instability and acts of war or terrorism, including escalating conflict in the Middle East and the ongoing war in Ukraine, and policy- and regulatory-related changes resulting from the recent changes to the U.S.

presidential administration.

These market and industry factors, as well as others, may materially reduce the market price of our common stock regardless of our operating performance.

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If one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, as they have done in the past, the price of our common stock would likely decline.

If few analysts cover us, demand for our common stock could decrease and our common stock price

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and trading volume may decline.

If few analysts cover us, demand for our common stock could decrease and our common stock price and trading volume may decline.

Similar results may occur if one or more of these analysts stop covering us in the future or fail to publish reports on us regularly.

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These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could cause the market price of our common stock to decline or increase the volatility in the market price of our common stock.

Our warrants are exercisable for shares of common stock, which could increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.

In December 2021, we completed the redemption of outstanding warrants to purchase shares of the Company’s common stock that were issued under the Warrant Agreement, dated October 8, 2020.

There are 12,170,990 Series H warrants issued in connection with the Series 1 and Series H preferred stock issuances in December 2019 that remain outstanding and were previously converted into SoFi Technologies common stock warrants.

To the extent such warrants are exercised, additional shares of common stock will be issued, which will result in dilution to the holders of our common stock and increase the number of shares eligible for resale in the public market.

Sales of substantial numbers of such shares in the public market or the fact that such warrants may be exercised could adversely affect the market price of our common stock.

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Our issuance of additional capital stock in connection with financings, acquisitions, investments, our stock incentive plans or otherwise will dilute all other stockholders.

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• a determination that our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

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• a limited amount of news and analyst coverage;

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These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in the Board of Directors or management of our company.

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The provisions of our bylaws requiring exclusive forum in the Court of Chancery of the State of Delaware and the federal district courts of the United States for certain types of lawsuits may have the effect of discouraging certain lawsuits, including derivative lawsuits and lawsuits against our directors and officers, by limiting plaintiffs’ ability to bring a claim in a judicial forum that they find favorable.

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federal securities laws and the rules and regulations thereunder.

The Delaware Forum Provision and the Federal Forum Provision in our bylaws may impose additional litigation costs on stockholders in pursuing any such claims and may also impose additional litigation costs on stockholders who assert that

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either such provision is not enforceable or invalid.

Additionally, these forum selection clauses may limit our stockholders’ ability to bring a claim in a judicial forum that they find favorable for disputes with us or our directors, officers or employees, which may discourage the filing of lawsuits against us and our directors, officers and employees, even though an action, if successful, might benefit our stockholders.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors