May 18, 2019

Feedback needed for a web app that helps getting an overview of all your loans

Casper Sørensen @Reached

Hi guys,

I would like some feedback on the following idea, as well as potentially find one or more partners who might want to join me on this journey.

The problem:

Even though I come from Denmark which in many regards is a very privileged country, many Danes actually face issues with debt. They take very expensive loans to buy stuff they don’t need, then once it’s time to pay for these loans they are unable to. In many cases this leads to them taking new loans to pay for the old ones, and once this happens they are in a never-ending spiral which often leads to hopelessness and depression for the involved people. Obviously not taking these loans is the first step to never get into this problem, however the truth is that with the amount of marketing these companies are able to afford, the amount of people being sucked in to this spiral will keep growing until something is done politically.

Solution:

People who take these loans often don’t have an overview of the amount of loans they have, the amount of each individual loan nor the actual cost of these loans - this is what I want to help with. My proposed solution is therefore a web app that helps you create this overview of each of your loans and the total amount owed. The idea here is then to be able to export the results to be used by debt counsellors who can then help them further.

Business model:

This is the part I am still not sure of as the users of the application are obviously not loaded with cash, so it might be tricky, one thing I do know though is that using the product should be free. Here are some Ideas I’ve had:

  1. Charge the user when exporting their results (not likely to be a success, and also compromises with the “free to use” promise)
  2. Only allow a certain amount of Creditors to be created in the system before users have to pay
  3. Charge debt counsellors for using their system for their clients (this changes the system quite a bit though)
  4. Get as many freemium users in as possible, and then figure out monetisation later
  5. ???

As mentioned above I am potentially looking for one or more people who would like to build this product with me, so if you feel like you might fit, let me know.

I am a full stack developer myself with Laravel/Vue JS as my core competencies.

#idea-validation

  1. 2

    I'm not a B2C expert, but I would steer clear of options 1 & 2. If your users are people who potentially have problems paying their loans, they are probably not in a position to pay you enough to make it worth your while. (In general, it also appears to be the case that data about consumers is more valuable to third parties than to the consumers themselves.)

    I would suggest looking at mint.com as an example of a similar successful product in the US & Canada. They basically tied into people's bank accounts and gave visibility into personal finances. It was free for the users but got acquired by Intuit for millions of $. I think their initial monetization plan was to identify alternate financial products and collect hefty affiliate fees. So they were kind of doing #4 but with a plan to make some money along the way.

    Good luck!

  2. 1

    I love this idea.
    I'm a full stack developer too (Meteor/NodeJS + Django).
    I have a solution on how to monetize, but I'm not sure how well this would work in Denmark. This is how you could do it in the US. You could monetize the customer data that these users want to repay their debts to the creditors. Of course, you would have to have a process in place for it. The creditors could provide algorithms that would be considered "acceptable" agreements.
    Typically, being a debt collector is $250 + legal fees + the cost of the debt. Because of that is the reason that many debts get insane penalties on lateness. For many people, they want to repay the debt, but they don't have the means to do so. In many cases, debt collectors are willing to make deals. People are much more willing to repay when they have an idea of what kind of payments they should expect. In theory, you wouldn't have the users pay anything. It would be the banks/credit companies who would pay. It is much less intrusive than calling the debt collector too. Something like this would require some seriously heavy security since it has highly sensitive data. NIST/ISO kind of standards.

  3. 1

    Bump :)