Brittany Moore’s mornings are timed with precision. After a lively early morning scramble to leave the house, she drops her young daughter at day care before making the long drive to work. When Brittany’s car broke down, she couldn’t afford to wait to fix it—but she also needed help financing repairs. Luckily, her employer offered Sunrise Banks’ TrueConnect, an affordable short-term, small-dollar loan.
“Without a working car, getting my daughter to day care and myself to work would have been quite a challenge. With TrueConnect, I could pay to get it fixed,” says the financial intelligence analyst. “And, the same time, the loan helps me build credit.”
This is exactly the type of success story Sunrise envisioned when it launched TrueConnect. “Without products like this, people are turning to the payday or auto title loans. Or they borrow from friends and family. And worst-case scenarios are bankruptcies,” says David Reiling, CEO of Sunrise Banks, which won a $2.2 million NEXT Opportunity Award for TrueConnect. “So we set out to offer a small dollar loan product that could compete head-to-head with these risky situations.”
Sunrise’s journey led to TrueConnect. The employer-based loan integrates with payroll systems through proprietary software that’s designed to scale. Based on a borrower’s salary rather than credit score, loans range from $1,000—$3,000 and, to avoid excessive borrowing, cap at 8% of wages. Payments are deducted directly from the borrower’s paycheck over a 12-month period. And Sunrise also offers employers its financial education program to accompany the loan.
The CDFI has successfully piloted the product with three employers in Minnesota, Ohio, and California, including Minnesota Lutheran Social Services (LSS), which employs 2,300 people statewide. “TrueConnect is a great benefit for us,” explains Joyce Norals, LSS, Vice President and Chief Human Resource Officer. “Occasionally employees with hardships or financial needs—maybe an unexpected hospital expense, car repair, or other emergency, or even to pay for a vacation—would come to human resources to ask for a loan. We had to say no, but now we direct them to TrueConnect. It’s easy to use, affordable, and confidential.”
With its NEXT Award, Sunrise plans to expand TrueConnect nationally, starting with new partnerships in Oklahoma, Arizona, Texas, and Florida. It expects to make $20 million in loans, evaluate the product to make necessary changes, and develop metrics to measure success.
“We are honored and humbled to receive the NEXT Award,” David remarks, “It will help us bring TrueConnect to scale nationally and offer a safe loan alternative for those 26 million Americans who do not have a credit score.”