Highlights:

64% of American workers run out of cash before they get paid. Many use high-cost debt such as credit cards, payday loans, or bank overdrafts to cover recurring bills and surprise expenses. Rocco is a financial technology startup that helps people avoid debt and overdraft fees by giving them early access to their earned wages.

Rocco does this by advancing up to $100 of interest-free cash to its qualifying users. Because of recent regulations and open banking technology, consumers can now allow lenders to access their bank account data. This means we can underwrite our users’ credit risk based on their bank account transactions (e.g., checking whether a user has consistent direct deposit income) rather than their FICO score and credit history. This greatly expands the market since people with bad (or no) credit who could not qualify before can now prove they are a good credit risk through other means.

The total addressable market is the 100+ million people in the United States who cannot afford an unexpected $400 expense. Many people resort to paying overdraft fees when they do not have the funds to cover expenses. In fact, the big banks charged nearly $12B in overdraft fees in 2019 alone. The Rocco app monitors its customers’ bank account transactions and alerts them when they are likely to overdraft their bank accounts.

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