SteadyPay co-founders Oleg Mukhanov and John Downie. Eventually, though, the startup will likely partner with a local bank to provide the capital, he added.
John downie full#
SteadyPay makes loans directly from its balance sheet today, a strategic choice Downie said helps the company maintain full control over its underwriting process. Since switching from a more manual, rules-based underwriting process to the AI-based algorithm, SteadyPay’s customer default rates have stayed consistently below 10%, he added.
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The average monthly top-up per customer is about £250, and the maximum balance a user can carry on SteadyPay at any given time is capped at £1,000, Downie’s co-founder and SteadyPay COO/CFO, Oleg Mukhanov, told TechCrunch. It also incorporates some transactional banking data and users’ public social media information to predict a users’ creditworthiness, Downie said. Its algorithm primarily leverages information from “open banking” data, which is secure customer information that large United Kingdom banks are required by law to share with third parties and technical service providers. The company underwrites users on the platform through an artificial intelligence-based model. He found that users were not necessarily looking for the product with the absolute cost - instead, they wanted a solution that was predictable and stable. The company has over 9,000 active users on the platform across a variety of industries, most of whom are between 22 and 40 years old, Downie said.ĭownie described SteadyPay’s model as “Netflix for credit,” explaining that early conversations with customers illustrated their desire for a simple, interest-free product. They can repay the top-ups interest-free, and only owe repayments back to SteadyPay when they make above their average income in a given month, Downie told TechCrunch in an interview. Users pay a monthly fee of £4 per week, or just over $5 a month, for the service. While for gig and freelance workers there were other solutions for pensions and things, there was very little in the credit space ,” Downie said.įounded in 2018, SteadyPay’s core offering is its income-smoothing product, which tops up a user’s bank account when their earnings fall below their monthly average. “Decades of traditional underwriting and a heavy reliance on FICO credit scores have been holding back a lot of innovation in the space. SteadyPay CEO and co-founder John Downie, who had spent most of his career building tech solutions for banks, realized that existing lending solutions did not address the needs of workers with irregular income.
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Workers who lack a regular income stream often can’t access loans from traditional financial institutions, making it tougher for them to make ends meet. London-based SteadyPay focuses on solving one major pain point for these workers - income volatility - which can make managing one’s personal finances much more complicated. The “gig economy” gave rise to a set of startups focused on meeting the needs of freelance and self-employed workers, from labor marketplaces Upwork and Fiverr to client management tools like Honeybook.