What Do Fintechs Winning With Gen Z Have In Common? Microloans

In the LinkedIn article “What Do Fintechs Winning With Gen Z Have In Common? Microloans,” Salus highlights how leading fintechs like Chime, Dave, and Varo Bank are capturing the Gen Z and Millennial market by offering small-dollar loans—often up to $500—without relying solely on traditional credit scores. These microloans address short-term liquidity needs and are underwritten using alternative data, such as transaction history, making them accessible to younger consumers who may lack extensive credit histories. With over 30 million combined customers, predominantly from younger demographics, these fintechs demonstrate the growing demand for flexible, inclusive financial products. LinkedIn+1LinkedIn+1

For credit unions aiming to attract and retain younger members, the article emphasizes the importance of adapting to these evolving needs. Salus's data reveals that 88% of microloan borrowers are Gen Z or Millennials, with an average age of 29. Moreover, 95% of borrowers who successfully repay microloans do not have prime credit scores, indicating that traditional credit assessments may overlook creditworthy individuals. By offering microloans and utilizing alternative underwriting methods, credit unions can better serve this demographic, fulfill their mission of financial inclusion, and remain competitive in a rapidly changing financial landscape.