Today, the payments and credit landscape is in continual flux and lenders are looking for more inclusive ways to meet consumer demands while reducing delinquency risk. If you’re not offering comprehensive and efficient lending options with risk mitigation, you could be missing an opportunity to increase sustainable revenue.
Introducing Paywallet
Officially launched this February, Paywallet is a new SaaS platform that enables lenders to validate an individual’s employment and banking information and establish repayment directly from payroll. It also enables ongoing monitoring of employment status. It is the only full life-cycle payroll-linked platform providing easy to integrate APIs for its clients for a variety of lending use-cases. Paywallet is a turnkey solution, made possible by our ability to aggregate multiple financial service and technology providers into consumable technology applications. This enables lenders to make ability to pay based credit decisions and be repaid directly from payroll, thus lowering default risk.
Annually, more than $10 trillion of funds move through paychecks. Paywallet aims to enable these funds as a secure payment option for any ongoing contractual obligation like leases, loans or Buy Now, Pay Later (BNPL) transactions. The system places the borrower firmly and transparently in control of sharing their employment, financial records and identity data for credit decision-making. With Paywallet, lenders can expand access more easily to those consumers who rely on their verified source of income as proof of their ability to pay.
Using a consent-based approach in which consumers can direct a portion of their paycheck to any deposit account, our technology facilitates loans to people who have low or no credit at rates much better than they could get otherwise. Paywallet covers more than 80% of people employed in the U.S. and nearly 100% of U.S. bank accounts.
We recently closed an $8.82 million Series A round led by Pasaca Capital Inc., a private equity investment firm. Investors PruVista Capital LLC and Arcadia Funds LLC also participated in the funding round.
The latest round of investments will enable us to expand our sales and marketing efforts, build partnerships with other financial products and services companies, extend coverage to 95% of addressable end customers/users, help initiate growth internationally and bring scalable, web 3.0 based decentralized and blockchain enabled applications to the lending industry.
How it works
Paywallet is the only payroll-based model that goes from validating the borrower’s employer and checking account where payroll gets deposited, to knowing when payroll is getting funded and getting loans paid directly from payroll.
Paywallet enables access to the customer’s payroll system with explicit consent and retrieves the employment, income and primary bank information required to assess a customer’s ability to pay. Paywallet then enables the setup of a virtual collection account that pulls a portion of the payroll into an account used to pay back the obligations of the customer in a secure manner to multiple debtors. We get money into the virtual account and from there we pay the lenders with no limitations to the number of obligations or finance arrangements.
The company is led by former Citi and other fintech executives with over 200 years of combined experience in financial technology. We are hands on technologists and bankers committed to using our experience to innovate and bring web 3.0 paradigms to lending to disrupt the way customer data is accessed and used for making credit decisions, and in the process democratize access to affordable credit for all.