Neyber, a provider of financial employee benefits, today launches a unique consumer lending platform enabling employers to offer loans at more affordable rates than are accessible on the High Street.
Loan repayments are taken through a unique salary deduction technology that integrates directly with employer payroll systems. Neyber plans to lend over £100M throughout the UK over the course of 2016.
The launch comes in the wake of Neyber raising £6m in the first close of series A funding which follows a £2.5m seed round in 2015. Neyber has invested significantly in designing a user experience and platform that currently doesn't exist in the market and is revolutionising the way employees can borrow money.
This follows a successful year-long partnership with Police Mutual1, the not-for-profit financial services provider to the Police family. Neyber lent £8M to serving police officers, civilian employees and their families over the past 12 months, on average, saving 20% on monthly debt repayments and gaining the equivalent of a 5% yearly pay rise2.
Neyber’s cloudbased tech solution integrates seamlessly with an employer’s payroll system. Its proprietary underwriting algorithm takes ‘know your customer’ to a new level and allows Neyber to take a broader and personalised view of an individual’s affordability and likelihood to repay and therefore applicants are more likely to be approved. Together with significantly lower cost of acquisition this means that Neyber can offer lending at more affordable rates than are traditionally available from banks or alternative lenders.
Neyber was founded by former Goldman Sachs investment bankers Martin ljaha and Monica Kalia along with financial technology expert Ezechi Britton. Britton is chief technology officer at Neyber and has ingrained tech into the DNA of the company. The founders joined together to deliver a genuine alternative to the solutions offered by financial service providers whose high borrowing rates and low returns on savings have helped to create an unprecedented era of financial stress.
Martin Ijaha, Neyber co-founder, comments: “Through Neyber we have created an exciting alternative lending platform which aims to address some of the challenges faced by existing alternative lenders. Neyber's disruptive approach to consumer lending allows us to better manage borrower defaults and originate loans at a vastly lower cost of acquisition and find credit worthy borrowers. Employers gain access to an easy to implement solution that integrates seamlessly with payroll that can also act as a tool for engagement and productivity and reduce stress related absenteeism."
Unlike banks, Neyber has a genuinely lower cost base due to a lower default risk by virtue of salary deduction and streamlined technology (no branches or legacy costs) enabling it to pass on the benefits of lower costs in the form of lower borrowing rates (4.9% APR) for customers.
Ezechi Britton, Neyber CTO, comments: “At Neyber we understand the challenges faced by HR Directors and have spent time listening to them on how technology can positively impact upon their work and the workplace. It’s why we have invested significantly in creating a unique lending platform that we know will revolutionise the concept of employee benefits in the UK.”
Employees who borrow from Neyber can choose from loans ranging from £500 - £25,000 to meet their personal needs. Neyber customers significantly reduce their outgoing costs through consolidating their existing debts in a single loan at a low competitive rate of 4.9% APR. Similar to the Police Mutual partnership, others too can save, on average 20% of their monthly outgoings, equating to a 5% yearly pay rise, during a period of continuing wage rise restraint.
Neyber recently conducted research into the UK’s consumer credit crisis in the UK workforce3. The research showed that over half of UK workers (53%) would value access to affordable loans from their employers.
The need is clear as one in 10 employees (9%) do not have any savings , with the same number (9%) paying more than half their income on debt repayments and a further tenth (9%) have defaulted on a loan in the past two years. Over half (56%) of employees would be worried if they had an emergency expenditure of over £1,000.
Almost two thirds (64%) of UK employees have been affected by money worries, with workers reporting that it is most likely to affect them by feeling stressed (38%) or anxious (35%). And as a result, over one in 10 (13%) have been unable to focus at work due to financial stress and a quarter (25%) of workers have lost sleep due to financial stress in the past year.
Neyber co-founder and chief strategy officer, Monica Kalia, added:
“Our research showed that over half (53%) of workers would value access to affordable loans and savings from their employer. Financial wellbeing has been quickly gaining recognition amongst HR professionals and the interest for our proposition amongst employers has been immense. It is imperative that employers provide their employees with the solutions they need to help them improve their financial, physical and mental wellbeing.”