Pathward and Propel Partner to Provide Credit to Underserved Consumers

Pathward is adding a new line of credit for consumers who have limited access to credit.

The national bank has partnered with Propel, a FinTech that will service the loans through its Lending-as-a-Service (LaaS) platform, Pathward said in a Tuesday (June 20) press release.

“We are thrilled to partner with Propel to bring this program to the market as a part of our Banking-as-a-Service [BaaS] offering,” Pathward President Anthony Sharett said in the release. “Working together, we can provide eligible borrowers with year-round access to credit through a better alternative to high-interest programs.”

The new Pathward Line of Credit created by this partnership will allow customers to access a flexible line of credit, move the funds to their core spending account and pay interest only on the drawn amount, according to the release.

Propel’s proprietary, artificial intelligence (AI)-powered platform enables Pathward to provide consumers with access to credit while limiting credit risk, the release said.

“For Propel, this partnership marks the launch of our Lending-as-a-Service product offering, a natural and critical evolution of our business,” Propel CEO Clive Kinross said in the release. “When we founded Propel, we saw the limitations of existing technology and service to the tens of millions of underserved consumers and have met our goal of building out a best-in-class AI-powered solution.”

PYMNTS research has found that millions of Americans struggle to access traditional credit options.

This has created an opportunity for FinTechs to empower customers to improve their credit profiles and thus broaden the types of services for which they can qualify, according to “FinTechs’ Role in Improving Access to Lending Services,” a PYMNTS and Sezzle collaboration.

This new partnership comes about seven months after Propel entered the Canadian market with an online credit offering for underserved Canadian consumers called Fora Credit, expanding its reach beyond the United States market it already served.

Propel’s newest partner, Pathward, was formerly known as MetaBank but rebranded as Pathward in March 2022.

“Our new name serves as a constant reminder of the importance of creating a path forward for the unbanked, underbanked and underserved to help them achieve economic mobility,” Pathward CEO Brett Pharr said at the time.