How Digital Disbursement Tools Are Changing Low-Dollar Lending
As Americans increasingly turn to their mobile devices to instantly pay through peer-to-peer (P2P) services like Venmo and Zelle, the act of writing a check or heading to the ATM for quick cash is becoming a thing of the past. This technology is also changing how consumers lend and borrow money, according to Travis Holoway, founder of short-term lending exchange platform SoLo Funds, particularly when it comes to low-dollar or short-term loans.
Holoway explained that he’s watched firsthand as the market for short-term and low-dollar lending opportunities — powered by P2P payments — developed. It’s the market SoLo Funds is hoping to serve, offering an alternative to more traditional options like payday loans, which can leave consumers in more difficult financial predicaments than before.
Under SoLo’s business model, which launched earlier this year, consumers willing to offer interest-free loans of up to $1,000 are matched with those in need of financial assistance. Borrowers are paid via ACH transfers and receive their funds within three to five days–soon to be same day.
Read the article on PYMTS