Chime, a consumer financial technology company, has introduced Instant Loans to provide pre-approved members with immediate funding access of up to $500.
This new offering offers a fixed interest rate and are available to Chime members who receive direct deposits into their Chime Checking Account.
Eligible members are notified within the Chime app and get instant access to funds.
The firm does not seek credit check for Instant Loans, but utilises its proprietary platform and data sources to assess eligibility.
Repayments are structured over three months, with no late fees or compound interest. The cost is set at $5 for every $100 borrowed, equating to a 29.76% annual percentage rate.
Payments are designed to be affordable, with automated options ensuring they do not surpass 10% of a member’s monthly cash inflow.
Chime reports on-time repayments to credit bureaus, allowing members to build credit.
According to a prior simulation with Experian, participants who consistently make payments on time could see their credit scores rise by 10 to 30 points.
The launch of Instant Loans follows other financial products introduced by Chime, including MyPay, which allows members to access up to $500 of their earnings before payday without interest or a credit check.
Additionally, Chime’s SpotMe feature enables fee-free overdrafts, covering over $30bn in transactions in 2024.
Chime chief product officer Madhu Muthukumar said: “We are relentlessly focused on helping everyday people achieve financial progress.
“Our members have told us that they want simple and transparent tools to access money when they need it, and to help them build credit — and we’re excited Instant Loans provides both to our members.”
In December 2024, a Bloomberg report said that Chime Financial confidentially filed for an initial public offering (IPO), appointing Morgan Stanley to lead the process.
“Fintech firm Chime launches Instant Loans” was originally created and published by Retail Banker International, a GlobalData owned brand.
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