Automated savings app Digit today announced the launch of Student Loan Payments, a new feature that helps members pay down student debt.
The short of it: Student debt affects 43 million people in the U.S. and has become one of the largest categories of consumer debt.
- 65 percent of college seniors in the class of 2017 graduated with student debt.
- The average student loan debt was $28,650 for the class of 2017.
- The average US household with student debt owes $47,671.
How Digit’s Student Loan Payments works: Digit analyzes consumer income and spending and automatically squirrels money away when opportunities arise.
- People use Digit to save for goals like paying off a credit card, creating an emergency fund, planning a trip, or making a down payment on a home.
- A Digit user can now set up a student loan goal and connect loan accounts to Digit. 25 percent of current Digit users have student loan debt.
- Digit supports student loan providers like Navient, Great Lakes, Nelnet, Fedloans, and American Education Services.
- Digit works in the background, identifying opportunities to save some cash and apply it to paying down student debt.
Growth: Digit has helped its users save over $2.5 billion since launching in February 2015.
- The average user saves $2500 per year with Digit.
- 75 percent of Digit users have credit card debt.
- The average Digit customer using the app’s credit card debt reduction feature is on track to pay down his debt 11 months faster, according to the company.
More student loan opportunities: Digit is another example of financial technology moving in to solve the massive student debt issue.
- Data firm Plaid recently launched Liabilities, which provides access to consumer loan data to help fintech firms address consumer debt.
- CommonBond is making inroads with employers that want to use student loan repayment an employee benefit. Late 2018, the firm struck a partnership with Fifth Third to offer its student loan refinancing services.
- Consumer lender SoFi also wants companies like WeWork to make student loan repayment a perk for its employees.