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> payday loan provider probably isn’t deluding themselves about making an impact Having worked at a YC-backed alternative to payday lender (https://www.//lendu

> payday loan provider probably isn’t deluding themselves about making an impact Having worked at a YC-backed alternative to payday lender (https://www.//lendup.com https://www.//lendup.com) and having spent a lot of the time in the call center listening to our customers, I'd suggest that a lender to folks without access to credit can have much more impact than you could possibly imagine. Being able to instantly inject $500 into the bank account of someone that needed it for a car repair or they'd lose their job when they couldn't get it elsewhere was only one of the many, many examples. Now multiply that by hundreds of thousands of customers, and the impact is not trivial by any measure. Taking something that is incredibly painful and making it a delight at scale is a beautiful thing, almost no matter how trivial that thing is. I'm reminded of when Steve Jobs forced the Apple team to shave 30 seconds off of the startup time, because multiplied by the number of people who use Apple devices it's the equivalent of years in aggregate. I love that there are thousands of companies trying to change the world by making the one thing they work on absolutely perfect. It's a great thing.

aphextron 8y ago
>Having worked at a YC-backed alternative to payday lender (https://www.//lendup.com https://www.//lendup.com) and having spent a lot of the time in the call center listening to our customers, I'd suggest that a lender to folks without access to credit can have much more impact than you could possibly imagine. Being able to instantly inject $500 into the bank account of someone that needed it for a car repair or they'd lose their job when they couldn't get it elsewhere was only one of the many, many examples. Now multiply that by hundreds of thousands of customers, and the impact is not trivial by any measure. This is exactly the mindless "head-in-ass" crap the OP was talking about. You're not helping that person by lending them $500 at 400%+ APR [0]. You are trapping them into a debt cycle they will most likely never recover from until default. Subprime lending is a predatory practice which has been around forever, no matter how you flip it. It is legal under our system though, so you're more than welcome to do it and profit from people's financial ignorance. Just don't try to pretend like you're helping anybody. [0] https://www.lendup.com/rates-and-notices https://www.lendup.com/rates-and-notices
- austenallred 8y ago
  You clearly don't understand how LendUp works, so I'll just leave it at that.
  - aphextron 8y ago
    Yes, clearly I just don't understand the complex problems they are tackling. I'm certainly not calling them out on being shady and awful like every other payday lender since forever [0]. A few takeaways from their most recent CFPB fine of $6 million : >"Misled consumers about graduating to lower-priced loans" >"Hid the true cost of credit" >"Reversed pricing without consumer knowledge" >"Understated the annual percentage rate" >"Failed to report credit information" It's honestly sad how weak the CFPB is, but at least it's something. This entire industry is a stain on humanity. [0] https://www.consumerfinance.gov/about-us/newsroom/lendup-enforcement-action/ https://www.consumerfinance.gov/about-us/newsroom/lendup-enf...
    - austenallred 8y ago
      Yes, I was there for all that. I am incredibly proud to call myself a LendUpper and I have no regrets. All of that stuff was either done on accident when the company was a small handful of people or is pretty innocuous (we got in trouble for not displaying on our advertising that the rate may differ from the imaginary icon we showed, which displayed one of the possible rates based on how much money you took out. Or getting nailed for trying to give people a discount if they promised early repayment and not giving the discount if they didn't pay in advance). Literally any company that had that regulatory weight on it would have the same number of things the CFPB could go after if they could, but no one else is trying to play by the rules and just operate out of sovereign nations.
anonnel 8y ago
To translate what was just said: payday lenders do, in fact, delude themsleves into thinking they are making an impact. It’s always the same material about “helping people in their time of need”. But the point isn’t about the immediate impact on people’s lives at the moment of funding ... rather the longer impact during the time that they will hold the debt, and the high interest cost to those who can afford it least. Multiply that into man-years per your Steve Jobs anecdote! ‍️(smh) There’s a reason usury is illegal, and why payday lenders have to pair with sovereign nations and shady legal structures, and why google won’t even list you, etc. shame. But oh no. I’ve just bad-mouthed a YC company on HN! Here comes dang!!
- austenallred 8y ago
  Lending to subprime borrowers is hard, because there's high default. Most payday lenders solve for that by having those that don't pay enter into a cycle of more and more loans that compounds. You know what LendUp does if a customer doesn't pay? It just stops, and tries to get you to pay back the original loan. No more compounding. That's a big difference. I you think charging $30 total interest for an instant $200 loan to someone with bad/no credit is evil and doesn't make a difference, you probably don't understand the realities of what people would have to do if LendUp weren't there. LendUp is run legally as a licensed lender in California. The shady legal structures in native american nations is what they're fighting. I'm damn proud to have spent a couple of years trying to solve it.
  - anonnel 8y ago
    > LendUp is run legally as a licensed lender in CA. Okay? ... every company has the same licenses. CashNetUSA, Quickloans, Captain America Loans, and hundreds of other companies. Including even most with the shady legal structures, based in Malta, etc. Google won’t list the Deleware ones either. Advertising platforms don’t like them. Cities don’t like them. Regulators watch them closely and frequently press charges. > I’m damn proud to have spent a couple of years trying to solve it. Look this is probably going to seem uncivil, but given the poor ethics of what you are talking about, I have no qualms shaming. I spent a few years founding a payday business. Ultimately, despite having the same “forgiveness” policies and “innovative” loan structures, and telling myself all the same junk you are telling yourself (CFSA PR propaganda) I couldn’t bring myself to treat poor people like a crop to be harvested. You know that forgiveness or not, the majority of borrowers are repeats, and that there is a huge incentive to maximize this. Essentially, people use you instead of a bank. There is no escaping that this means you are in the business of siphoning 10% off of an already poor person’s wages on an ongoing basis, and that’s without compounding. (Sounds like 15% by your numbers) Do you really feel good that you did this? You drank some silicon valley koolaid, worked as someone else’s employee and harvested poor people? And then acted as the company’s mouthpiece afterward? Because you want to feel congruent with your resume? Before you say I don’t know blah blah about LendUp ... hear this: A great many Payday companies came before LendUp, attempting the PR of being “ethical” and “innovative”, with the same practices. And by far they have not been the last. They’re all still in the business of fleecing at least 10% off of the people who can afford it least. There’s always money in stealing from the poor. The only innovative thing they did was to con YC. (hi) Do not deceive yourself or others. It is not an honorable business. It is a called a VICE INDUSTRY for a reason, and you guys didn’t do anything to “solve” it (by your own admission of the word “trying”). I know ... you want to stand by what you did, but if I were you, I would put that one in the rear view.

aphextron 8y ago

>Having worked at a YC-backed alternative to payday lender (https://www.//lendup.com https://www.//lendup.com) and having spent a lot of the time in the call center listening to our customers, I'd suggest that a lender to folks without access to credit can have much more impact than you could possibly imagine. Being able to instantly inject $500 into the bank account of someone that needed it for a car repair or they'd lose their job when they couldn't get it elsewhere was only one of the many, many examples. Now multiply that by hundreds of thousands of customers, and the impact is not trivial by any measure. This is exactly the mindless "head-in-ass" crap the OP was talking about. You're not helping that person by lending them $500 at 400%+ APR [0]. You are trapping them into a debt cycle they will most likely never recover from until default. Subprime lending is a predatory practice which has been around forever, no matter how you flip it. It is legal under our system though, so you're more than welcome to do it and profit from people's financial ignorance. Just don't try to pretend like you're helping anybody. [0] https://www.lendup.com/rates-and-notices https://www.lendup.com/rates-and-notices

austenallred 8y ago
You clearly don't understand how LendUp works, so I'll just leave it at that.
- aphextron 8y ago
  Yes, clearly I just don't understand the complex problems they are tackling. I'm certainly not calling them out on being shady and awful like every other payday lender since forever [0]. A few takeaways from their most recent CFPB fine of $6 million : >"Misled consumers about graduating to lower-priced loans" >"Hid the true cost of credit" >"Reversed pricing without consumer knowledge" >"Understated the annual percentage rate" >"Failed to report credit information" It's honestly sad how weak the CFPB is, but at least it's something. This entire industry is a stain on humanity. [0] https://www.consumerfinance.gov/about-us/newsroom/lendup-enforcement-action/ https://www.consumerfinance.gov/about-us/newsroom/lendup-enf...
  - austenallred 8y ago
    Yes, I was there for all that. I am incredibly proud to call myself a LendUpper and I have no regrets. All of that stuff was either done on accident when the company was a small handful of people or is pretty innocuous (we got in trouble for not displaying on our advertising that the rate may differ from the imaginary icon we showed, which displayed one of the possible rates based on how much money you took out. Or getting nailed for trying to give people a discount if they promised early repayment and not giving the discount if they didn't pay in advance). Literally any company that had that regulatory weight on it would have the same number of things the CFPB could go after if they could, but no one else is trying to play by the rules and just operate out of sovereign nations.

anonnel 8y ago

To translate what was just said: payday lenders do, in fact, delude themsleves into thinking they are making an impact. It’s always the same material about “helping people in their time of need”. But the point isn’t about the immediate impact on people’s lives at the moment of funding ... rather the longer impact during the time that they will hold the debt, and the high interest cost to those who can afford it least. Multiply that into man-years per your Steve Jobs anecdote! ‍️(smh) There’s a reason usury is illegal, and why payday lenders have to pair with sovereign nations and shady legal structures, and why google won’t even list you, etc. shame. But oh no. I’ve just bad-mouthed a YC company on HN! Here comes dang!!

austenallred 8y ago
Lending to subprime borrowers is hard, because there's high default. Most payday lenders solve for that by having those that don't pay enter into a cycle of more and more loans that compounds. You know what LendUp does if a customer doesn't pay? It just stops, and tries to get you to pay back the original loan. No more compounding. That's a big difference. I you think charging $30 total interest for an instant $200 loan to someone with bad/no credit is evil and doesn't make a difference, you probably don't understand the realities of what people would have to do if LendUp weren't there. LendUp is run legally as a licensed lender in California. The shady legal structures in native american nations is what they're fighting. I'm damn proud to have spent a couple of years trying to solve it.
- anonnel 8y ago
  > LendUp is run legally as a licensed lender in CA. Okay? ... every company has the same licenses. CashNetUSA, Quickloans, Captain America Loans, and hundreds of other companies. Including even most with the shady legal structures, based in Malta, etc. Google won’t list the Deleware ones either. Advertising platforms don’t like them. Cities don’t like them. Regulators watch them closely and frequently press charges. > I’m damn proud to have spent a couple of years trying to solve it. Look this is probably going to seem uncivil, but given the poor ethics of what you are talking about, I have no qualms shaming. I spent a few years founding a payday business. Ultimately, despite having the same “forgiveness” policies and “innovative” loan structures, and telling myself all the same junk you are telling yourself (CFSA PR propaganda) I couldn’t bring myself to treat poor people like a crop to be harvested. You know that forgiveness or not, the majority of borrowers are repeats, and that there is a huge incentive to maximize this. Essentially, people use you instead of a bank. There is no escaping that this means you are in the business of siphoning 10% off of an already poor person’s wages on an ongoing basis, and that’s without compounding. (Sounds like 15% by your numbers) Do you really feel good that you did this? You drank some silicon valley koolaid, worked as someone else’s employee and harvested poor people? And then acted as the company’s mouthpiece afterward? Because you want to feel congruent with your resume? Before you say I don’t know blah blah about LendUp ... hear this: A great many Payday companies came before LendUp, attempting the PR of being “ethical” and “innovative”, with the same practices. And by far they have not been the last. They’re all still in the business of fleecing at least 10% off of the people who can afford it least. There’s always money in stealing from the poor. The only innovative thing they did was to con YC. (hi) Do not deceive yourself or others. It is not an honorable business. It is a called a VICE INDUSTRY for a reason, and you guys didn’t do anything to “solve” it (by your own admission of the word “trying”). I know ... you want to stand by what you did, but if I were you, I would put that one in the rear view.