_megha_agarwal

Hi Chris!

Thanks for your detailed feedback. You have a ton of great insights on bills that businesses pay. To answer your questions -

We started out, we intended to cover user's essential household bills only (rent, and utilities). But we had some early adopters add their business bills as well, and we decided we weren't going to turn them away. So as far as the bills fall in these categories - Rent, Electricity, Internet, Telecom, Water, Gas, Parking or HOA - we cover them both for businesses and consumers. We do not cover the type of B2B bills that businesses need an accounting software for. So we think, we can co-exist with the likes of QBO/Xero.

We don't think that the B2C side is not lucrative enough, given in the absence of fair lending products users resort to Payday or other high cost loans. In numbers, Payday Lending is a $90B industry and 70% of those funds are used to cover a recurring household bill such as rent or utilities. That being said, our current users are definitely not the ones who are desperate for cash or just bad with finances (people often think that we’d be competing with the likes of early-pay or cash advance apps). That’s not true. Our users are actually fairly responsible and tech savvy. They might or might not have been affected by the pandemic, and are actually using credit line at 0% APR to spread out their bill payments but also, benefit from bill consolidation and automatic payments. Solopreneurs, small business owners, white-collar workers are the ones who are using us currently.

How are you monetising this? You are shouldering such massive risk here, surely you will get masses of late payments & defaults ... We plan to monetize from businesses. Mostly through partnerships or transaction fees on payments processed through our platform. The intent is to look for value add services for our users, for ex: some users want to know how their bill amounts compare to others in the same area/demographics and get better deals. By showing relevant deals and helping businesses gain customers, we can earn revenue. However, these are just some preliminary ideas, we’re exploring.

As for the risk, we’re thinking about it differently. Rather than profiling users as risky or not, we evaluate risk for transactions or payment types. Surely, essential bills are always top of mind for individuals, and likelihood on screwing those up is the least, even if you compare people across credit scores. That doesn’t mean that people will not default - there will be circumstances where people may not be able to pay even most essential ones, however, we are hoping that (most) people can recover from those circumstances. Our philosophy of avoiding interests and fees will keep overall debt levels lower, and hence, reduce time in which they can recover.

We really appreciate your kind words. And yes, we’re not out there to exploit people. We believe people are more good than evil, and wealth is not the best way to judge a person’s willingness or ability to pay back. We just want to build the right products and incentives to help them be more responsible.

Here's an interesting CNBC article that estimates late fees, overdrafts and even fraud cost Americans an extra $577 annually. https://www.cnbc.com/2020/07/14/us-households-spend-an-extra...

That's a good point you bring up! In this day and age, there is no reason, a customer should have to pay overdraft fees. We always check our customer's bank accounts to make sure they have enough money to make their payments, and never make a charge if that is not the case. So we ensure there are no NSF fees from our side or your bank's. Also, our customers can pay Rent using our virtual credit line, so you won't have to worry about checking your bank balance each time.

Got it! We are providing a virtual credit line that is used to directly make payments on your behalf, so to answer your question - no you cannot use Amex to pay us. Our customers pay us directly from their bank account, pretty much the way they would pay for their other credit cards. We're different from traditional cards though, because we offer a credit line at 0% APR and no fees (overdraft fees, late fees etc.) and you can pay Rent using Neon (which is otherwise not possible using traditional credit cards or there are high fees). Besides, we do not charge any additional convenience or processing fees that traditional card companies do. As far as the points go, we'll be launching some features soon, that will far outweigh the returns you get from accruing points on your cards. :) Keep an eye out on our website, if you'd like to learn more: www.neonforlife.com

That's interesting, thanks for sharing! We're building Neon, a one-stop bill pay solution for all your essential bills and hence, we're interested in learning what else can be done to improve user experience. Would you think a centralized dashboard where you can add your bills once, and then can control such things (like payment methods or bank account), help? For some added context, we provide a credit line at 0% APR and automate payments using that credit line. We also consolidate all bills in a centralized location, on our dashboard.