HelpPays is combining micro-lending and peer-to-peer lending to help lenders provide funds without having to undertake the awkward work of overseeing repayment and to help borrowers acquire funds and build credit.
The company also is promoting a crowdfunded marketplace in which would-be borrowers seek as little as $50 and if faithful in repaying those loans are able to borrower larger amounts as they build their credit. Loans can have terms as long as nine months, according to a Tuesday (Sept. 13) press release.
One advantage for lenders, according to the announcement, is the ability to write off losses if loans aren’t repaid.
HelpPays took aim at payday lenders in its press release, saying, “At payday lenders, if a consumer cannot repay their loan by payday, the loan is extended or ‘rolled over’ at a compounded interest rate with accumulating financing fees … With HelpPays, borrowers only pay back the interest they requested, and loan extensions have no penalty.”
“We are building a HelpPays community. For every advantage we give to a lender, we look for a way to extend it to a borrower,” Chief Technology Officer and Co-founder Emmanuel Aubrey said in the release.
According to HelpPays, 198 million Americans live paycheck to paycheck and could not afford a $1,000 emergency expense. Moreover, the company said, cited federal data, 26 million Americans, or 10% of adults, need loans from friends and family members.
“We are making a big bet that we know to be true. Americans care and are willing to help other hard-working, honest Americans. HelpPays is proud to deliver meaningful returns to our lenders while providing our borrowers with dignity and trust,” Chief Executive and Co-founder Shamari Benton said in the announcement.
HelpPays is based in Detroit.