Index-backed Pariti is an app to help you get out of debt – TechCrunch
Lots of booming fintech startups in London – from the online wealth manager Nutmeg to “micro-savings” bots Plum and Chip – focus on savings and investments by making it easier and more competitive to set aside for rainy days. However, a startup, discreetly supported by Index Ventures and JamJar Investments at the end of 2015, approaches financial health from a different and more immediate angle: debt.
Founded by Matthew Ford, who was previously responsible for acquisitions for On the trees, a personal finance app that left MoneySuperMarket in 2014, Parity is a mobile app that helps you keep tabs on your spending and, most importantly, track how much you’re paying for existing debt service, like overdrafts or credit cards. He then suggests changes you can make to pay off that debt faster.
“We connect to your existing banks and credit cards to analyze your financial situation and calculate if you can save on your debt,” says Ford. “Our smart algorithms forecast future income and bills to calculate what is left to spend, save and pay off debt.”
The key to this – and where the startup’s mission to “get out of debt faster” really matters – is that, where applicable, Pariti allows you to apply for a consolidation loan right in the app. “We have partnered with Zopa to provide low cost consolidation loans to users who can benefit from them,” says Ford. “Users can borrow up to £ 25,000 at rates as low as 3.5% APR and can apply in under three minutes through the Pariti app.”
It must be said, however, that Pariti is not only a way to create a pipeline of potential people that its partner lenders can lend to, but is based on the premise that much of consumer debt is opaque and too much of it. people are not. t aware of the real cost of the money they – sometimes inadvertently – borrowed.
The startup claims that in the UK alone, one in five people are considered over-indebted and a third of people are only able to pay off their minimum card balance each month.
To solve this problem, Pariti’s new functionality calculates how much a user’s debt (credit cards and overdrafts) is actually costing them.
“Thanks to their transactional data, we track all the fees and charges to show what is the real monthly cost of their debt,” explains the founder of the startup. “Based on this data, we calculate how much users could save each month if they were to replace that debt with a loan. “
Another aspect of consumer debt that Pariti wants to bring more transparency to is the humble (and squeaky) credit rating.
By giving the app read-only access to your bank account and to your credit card transaction data, Pariti gets a pretty good picture of your financial health and should be able to create a more accurate and up-to-date credit score. day, which in turn can be used as a lever to apply for cheaper credit. Again, the end goal is the same: to help you get out of debt faster.
“With a near real-time view of a user’s financial condition and our own proprietary valuation approach, Pariti can help lending partners get a much more accurate picture of consumer suitability, affordability and creditworthiness, and users can engage and improve their situation more transparently, ”adds Ford.