How Fig Loans seeks to disrupt the payday lending industry
Meet the fig loans. Fig is changing the way people with bad credit experience banking. They offer emergency loans and financial stability products to help you overcome unpredictable financial challenges. Fig is committed to offering financial products to its clients in a socially responsible manner.
The fig fee is designed only to cover the service costs of the fig loan – that’s it. Their loans give customers the most affordable product when they need it most. Fig ignores a traditional credit score when making loan decisions. Instead, the company examines your ability to repay the loan based on account age, income, and existing or past loans.
Fig currently offers loans between $ 300 and $ 500 and the loans cost less than $ 4 for every $ 100 borrowed every 2 weeks. Loans are repaid over four months, in 4 equal monthly installments. Unlike payday loans, Fig Loans works with you to adjust payment dates because they understand that life doesn’t always follow a schedule.
Transparency is what sets Fig apart from payday lenders. They don’t charge surprise fees and even offer customers a discount if they choose to pay off their installment loan sooner!
Below is a Q&A with Fig Loans co-founder Jeff Zhou
What inspired you and your co-founder to launch Fig Loans?
John and I are able to start Fig because along the way people tried our luck. Whether it was an education, a job or an investment, they could have chosen anyone else, but they gave us that opportunity. As a result, these institutions are more than schools, employers or investors for us.
The credit catch-22 traps people out of traditional credit markets. You have to get credit to build credit, but if you have bad credit, no one will give you credit. Fig takes a leap of faith every time we lend. We give our borrowers the opportunity to show that they are more than their credit score. And once we help them succeed, I hope they see us as more than a lender.
Can you explain what payday loans are and how they can be predatory?
Payday loans are marketed as payday advances for emergency needs. Borrowers are generally unable to access lower cost traditional credit products such as credit cards. Payday loans are predatory because they are designed to trap customers in debt.
Predatory loans come with insanely high interest rates and, more importantly, the fine print that structurally prevents borrowers from repaying the loans. For example, payday lenders often charge a fee for prepaying your loan, they may only accept payments in person, they may not accept partial payments, and all of this in addition to late fees and charges. expensive modification.
To shed light on the most common predatory features of a payday loan, we’ve created our own 5-step lending guide to help borrowers identify dishonest lending practices and predatory fine print.
How Are Fig Loans Different From Payday Loans?
Originally designed with the financial coaches of United Way THRIVE, Fig is the loan you would make to a friend. Fig loans are 60% cheaper than payday loans, have no additional fees, report credit, and even come with a prepayment discount.
Our mission is financial health, so our product is intentionally designed to encourage borrowers to make good financial choices, such as prepaying the loan. As another example, Fig offers flexible repayment plans with no additional fees or interest. Finally, we are always honest with our customers and want to help them find the best solutions, even if it is not a Credit Fig.
Can anyone apply for a Fig loan or do you have to live in a certain state?
You must currently live in Texas or Missouri to get a loan Fig. However, we are growing rapidly and will be available in Illinois, California and Ohio by the end of the summer!
How can other communities activate Fig loans in their states?
Can you tell us a little more about your social mission and how Fig plans to empower communities?
Fig’s mission is to provide responsible financial products to borrowers by aligning our business model with their financial health. Communities are essential to creating and maintaining sustainable financial health for our borrowers. To this end, Fig aims to be the ultimate tool for our partners, creating products that complement and enhance their capabilities. An example of this is our new product called Fig36!
Fig36 is a turnkey loan-as-a-service solution that we provide for free to our non-profit partners. Fig36 brings together all of Fig’s loan, underwriting, legal, customer service and credit reporting technologies into one platform that allows our partners to build their own emergency loan programs. Fig takes care of the loan of nuts and bolts, allowing our partners to focus on their customers.
What inspires you in your work?
All! Customer success stories are amazing, but my daily inspiration comes from the dedication and passion of the Fig team and our partners. Fig’s team moves mountains so Fig can keep their promises. As a business, we often take the longest and most difficult path because we are unwilling to compromise when it comes to customer results and business efficiency.
We are able to operate at a fraction of the cost of our competition and deliver a far superior product because everyone is in the background changing the paradigm to make it possible. Our amazing partners could spend their time anywhere else, but they chose to work with Fig so we have to do our best to be more than just a partner!
What is the ultimate dream vision for Fig Loans and what can it become?
Our products are the gold standard in financial services and are delivered in communities around the world. In every community, we are active participants, contributing not only as a business but also as citizens. I want each local partner to meet Fig team members in person, spend time with us, and confidently state that Fig is a constant force for good in their community.
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