Candidly, a platform that aims to help individuals pay off their student loans while saving and building wealth at the same time, yesterday announced it had raised $20.5 million in a Series B round of financing.
The company says it partners with employers, retirement recordkeepers, and financial services companies to embed its gamification repayment and auto-payment technology into its partners’ digital experience, creating a seamless user experience for consumers, who pay an extra $45 a month toward their student loan debt, on average.
“We exist to crush debt, and to empower hard-working Americans to go beyond student debt, into wellness, and ultimately wealth,” said Laurel Taylor, founder and CEO of Candidly, in a published report. “More specifically, most who have student debt are focused on achieving freedom from debt at the expense of building wealth. Our mission and our capabilities enable users to make simultaneous progress so that we don’t have to choose between our past and our future when it comes to financial health and wellness.”
One partner, American Eagle Outfitters, announced in February that its employees had paid down $100,000 in student loan debt using Candidly’s platform.
Even if the Biden administration’s attempt to wipe out as much as $20,000 in student loan debt is successful before the Supreme Court, there will still be a lot of student loan debt on the books. And once individuals have to start making student loan payments again — which will likely happen later this year — that could put people into greater financial peril. Most Americans are not able to afford a $500 emergency without borrowing money.
“The one-time discharge isn’t a painkiller, but it may be a vitamin,” Taylor said in the report. “It helps a little bit, but there’s still a big amount of debt to slog through for the average American in our workforce today. The reason we raised this round was to scale our ability to transform financial outcomes for the users that we serve, for the employers that are providing us as a benefit and for the channels that are distributing us.”””
