With all the fintech and focus on the unbanked and underbanked, there are still tens of millions of Americans who lack access to mainstream financial services. Those are Mission Lane’s customers. A spinoff of LendUp, the firm’s credit card is the first product in a portfolio designed to address this demographic’s financial needs and wants.
Shane Holdaway is Mission Lane CEO. After a career on the other side of the aisle, running businesses for large traditional financial institutions, he’s charged with leading the company into its next stage of maturity. We talk about his personal transition from finance to fintech and how that informs his work. We talk about why the financial industry has failed so many and what he and his firm plan to launch and grow in the future.
Shane’s background: Shane joined Mission Lane two years ago, shortly after it spun off as a separate company almost spending almost two decades inside large financial institutions — banks — in the US.
“One of the things I observed when I was inside larger financial institutions: you tend to carry the consequences of technology and other marketing decisions that happened years ago for a long time.”
Why banks don’t serve the underserved: “I observed from inside the challenges that large banks face in serving half of the adults in the US — not for lack of talent, or lack of desire, or even lack of vision, but there’s structural aspects that large financial institutions have to deal with that make it challenging. They have real or perceived questions about reputation risk and regulatory constraints serving this audience.
There’s also the highly technical nature of underwriting higher risk consumers, which, unless you’ve spent years building up your data and your underwriting, it can be daunting. And then there’s the cost of serving these consumers who traditionally have lower deposits, lower usage of many of the larger banks products — so with legacy cost infrastructures that are quite heavy, it can be expensive for these institutions to serve these customers.”
The Mission Lane Mission: “Embedded in our company name is the notion of Mission Lane. We talk about the lane, to provide a path forward for people to help them improve their financial lives. We do that in a couple ways. One is that we lend money, where it is difficult for others to do so. And we do that through our proprietary underwriting, which is a very data- and technology-intensive undertaking. The second thing we look at is how we create a positive wedge in people’s personal finances.”
Communicating around credit opportunities: “If you think about the problems we’re trying to solve, for a lot of our customers, it comes down to getting access to quality credit. So in terms of messaging, it’s we can provide you that access. We obsess about the way we communicate in a very clear, candid, and uncluttered kind of way.
The product pipeline: “We want to be able to serve as many people as possible, and we want to be able to do it in a way that will be cost effective and a good value for them. So one vector of our product roadmap is creating a family of products. We call them internally credit builders, but they’re products that allow people to enter the Mission Lane franchise, and help them graduate to the next product.”
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