Some Dude Who Hasn’t Shaved in Two Days Wants to Give You a Loan on Your Phone

And He’s Now the CEO of a Multi-Billion Dollar Public Company

Andy Spears

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Dave CEO Jason Wilk

Jason Wilk is the CEO of a banking app that wants to help you out — and keep you from paying expensive overdraft fees. At least, that’s the premise behind the “Dave” app that allows consumers to take out payday advance loans of up to $250 right from their phones.

American Banker reports that Dave is now a public company thanks to a multi-billion-dollar IPO.

The Los Angeles-based Dave merged with a blank-check company sponsored by Victory Park Capital, VPC Impact Acquisition Holdings, on Thursday. Dave is now publicly traded on the Nasdaq exchange and valued at $4 billion. It was set to offer 376 million shares at $10 per share, according to a federal securities filing.

Dave, which launched in 2017, was one of the first neobanks to offer an alternative to overdraft fees. It offers members small loans called ExtraCash they can use when their bank accounts run low.

So, what’s the problem? There’s a cool CEO in the requisite t-shirt and hipster beard and there’s an app that is user-friendly and purportedly saves users money. Plus, it’s a convenient way to avoid those gross payday loan stores.

Some analysts suggest that apps like Dave and others are merely a kinder, gentler payday loan.

The End of Payday Loans or a Kinder, Gentler Predator? | by Andy Spears | Dec, 2021 | Medium

Adam Hardy writes in Money.com that a number of cash-advance apps are suggesting they offer a viable alternative to payday loans but may instead offer a similar product in a more tech-friendly package.

Hardy reviews the policies and practices of apps such as Dave, Earnin, and Brigit and finds that:

“. . .consumer experts warn their fees are just as bad as — if not worse than — traditional payday loan APRs, with rates that can easily top 300%. And, they say, the apps can actually trigger overdraft fees.”

Additionally, the apps use behavioral marketing techniques to encourage higher “tips” — a euphemism for the fee charged to use the service above the $1 a month membership…

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Andy Spears

Writer and policy advocate living in Nashville, TN —Public Policy Ph.D. — writes on education policy, consumer affairs, and more . . .