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Credit Start Up To Target Generation Z And Millennials

Credit Start Up To Target Generation Z And Millennials
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The problem; the younger generation are increasingly wary of credit cards. They don’t want to be in debt like their parents’ generation. So wily credit card companies are attempting to challenge that.

Research has shown that just 33% of young Americans aged between 18-29 have a credit card, a fact that has caused concern amongst card providers.

But also, without credit cards, these younger people are finding it harder to build up a credit rating, which will enable them to take out a mortgage and get a foot on the property ladder later on.

Now there are several companies which are engaging with this generation, to offer them ways of building credit.

One of which is Deserve, who have recently changed their name from SelfScore. This is a start-up company which is based in Menlo Park.

The company which has worked together with international students, has come up with a card which is intended to be attractive to this lost generation of credit users.

Principally aimed at younger adults, teens and Generation Z, Deserve have made $12 million available in funds with partners from Accel, Aspect Ventures and more besides.

According to the company’s co-founder, Kalpesh Kapadia, these millennials are in a Catch 22 situation, whereby the lack of credit is perpetuating a problem in obtaining credit. To get off this treadmill they have been targeted by the firm.

Deserve believes that this age group should be given the opportunity to build up their credit rating, where other companies have given them the brush off.

Of course, there is always a risk with offering credit to people who have no credit history and the company will have to take the chance that their investment will not be repaid. But, as with all high risk credit ventures, they come with a higher interest rate to counter that eventuality.

Instead of using a credit rating score in order to decide who should be offered a credit card, Depend have another way of assessing the eligibility for their services.


Their novel method of deciding who should be given this line of credit is to use machine learning to find criteria such as self-discipline, employment, levels of education and reliability.

One of the investors from partner company Accel stated that this new method of assessing financial worthiness is very interesting and could be the way forward for the future.

This is a learning opportunity for the industry to determine who should be given credit, without already having a prior credit rating.

Whether Generation Z and the Millennials will embrace this technology and decide that they want to take up credit, remains to be seen. But for those that do, they are being given the chance to build their credit rating for the future.

More than that, this could be used as a way of helping to create a future with financial independence for this younger generation – which could help them to get mortgages later on.

It is possible that the younger generation have learned from their parents’ mistakes and have turned their backs on credit and the huge debts that go with it – and perhaps they cannot be blamed for that.

But what Deserve is offering could prove too good to be true – a way for them to obtain a credit rating, without having to first already have a credit history.