Whether or not you love technology, it can be hard to stay on top of the latest and greatest fintechs. As a leader for a socially responsible bank, we are constantly looking for new solutions and innovations that are helping others achieve financial wellness and change lives. Here are five fintechs that I believe are doing just that.
1. Self Lender
In their own words, Self Lender wants to “create a simple way to establish credit history for the first time.” They offer an online credit-builder loan for people to establish credit history through a “savings-secured” loan.
What does that mean for you? When you take out a credit-builder loan, you don’t receive the money right away, rather you receive the money after you pay off the loan. Your loan amount is deposited in a certificate of deposit, or CD, until the completion of the loan term. This isn’t a replacement for a secured credit card for building credit, but another avenue for establishing or repairing credit.
For new Americans and recent college graduates, Self Lender can be extremely helpful. Building a credit history from scratch used to take a lot of time and risk, now it’s a much faster and simpler process; helping people gain access to other secured loans such as auto-loans and mortgages.
2. Peanut Butter
Ping pong tables, beer fridges, and doggy daycare are just a few examples of the employer-offered benefits trend that has popped up recently to attract young employees. Peanut Butter has another benefit idea to attract this talent; student loan forgiveness.
According to their research, Americans hold $1.4 Trillion in student loan debt in what is being called a debt crisis. A majority of people in the workforce have student debt and those workers name student loan forgiveness as their most desired benefit, above health insurance and retirement plans.
Peanut Butter takes the hard work out of the employers’ court and offers a simple offering that they claim helps attract and retain college-educated talent. In addition to the debt repayment services, Peanut Butter also offers financial and debt counseling.
Another employer offered fintech that is making a difference is TrueConnect. Payday lending has been a hot button issue recently. After predatory lending practices came to light, the payday industry was put under a microscope, but the access to small dollar loans is still a large need.
TrueConnect, offered by Employee Loan Solutions, is an employer-offered small dollar loan alternative. Working through the employer and their payroll, borrowers can’t take more than they can pay back, and payments are deducted from checks over the course of the loan.
What does that mean for you? TrueConnect is offered through employers and it’s a great way to take control of your financial wellness. The fast loans can help offset a financial hardship and may reduce financial stress facing many American households.
Because there is no cost to the employer, this benefit isn’t limited to large scale corporations and as a way to avoid the cycle of debt surrounding payday lending, it is a huge step in the right direction.
For the average person, investing is almost a dark art. For Blooom, making 401k management simple and available to every American is their goal.
The premise relies on robo-advising that uses a combination of artificial intelligence and human advisors to manage users’ retirement portfolios.
Blooom is perfect for hands-off portfolio management and employer-sponsored plan participants. They have no account minimum and a flat management fee. For those interested in learning as they go, they offer assessments and one-on-one chat support with advisors to make sure that all Americans can build for their retirement.
One of the main challenges facing many people that I see is financial planning. Planning for expenses and making sure they have cash flow causes a lot of stress and the reality of the gig economy is that income can be very volatile. Even is an app that helps smooth out people’s monthly income to combat that uncertainty.
Even looks at your average paycheck, and adds the extra from above-average months to a savings account. When you encounter a lean month, that account helps supplement your income to make sure expenses are covered.
It is a life-changing offering for hourly or part-time employees. Income fluctuations can cause overdrafts that pile up fees and increase the need to use short term credit.