Calling themselves “the future of personal finance,” MoneyLion is a data-driven personal loan provider who also offers free credit monitoring, money and wealth management tools, along with financial advice.
Because of this “360 degree approach” to financial health, MoneyLion claims to have originated over 100,000 loans and lent nearly $50 million across all 50 states.
But can they really give you peace of mind and help you make smarter decisions? Are they a viable way of managing your wealth, or are they simply a payday lender dressed up in nice clothes? That’s exactly what we’ll help you decide in this review.
To kick things off, let’s take a closer look at what MoneyLion has to offer.
What Products & Services Does MoneyLion Offer?
Overall, MoneyLion delivers five different products and services:
Loans & Other Credit Products
More than anything else, MoneyLion is a lender who provides unsecured (you won’t have to have collateral) personal loans between $1,000 and $35,000, which can be used for whatever you want, without restrictions.
Among these, MoneyLion offers three different loan types:
- MoneyLion Loans – If you have an excellent credit history, you may qualify for these prime loans at low interest rates (more about this in a second).
- LionLoans – If you need to take control of your finances and/or start building credit, these smaller loans might be ideal.
- LionPay – Here’s how the company describes it: “Convenient financing with low rates and no hidden fees, for customers who want to make worry-free purchases.” What, exactly, this means and how it differs from MoneyLions’ other loans products, we’re not told.
If you’re interested in one of these loans, MoneyLion claims you can check rates and receive a prequalification in 5 minutes, which won’t affect your credit score. If you decide to apply, they’ll then pull a “hard” inquiry.
After approval, you’ll be able to sign your loan agreement electronically and the funds will generally deposited in your checking account the next business day.
What Interest Rates will You Pay on Your MoneyLion Loan?
We’re not provided with a lot of insight into MoneyLion’s different loans, although we are told they start at a 7% interest rate—likely for the prime option we discussed above.
You’ll also have an origination fee of between 0% and 6%, a 5% or $25 (whichever is greater) fee for late payments, and a $15 NSF fee per occurrence. You’ll be able to pay off your MoneyLion loan at any time without penalty.
Compared to other installment/payday lenders, one of the unique things about MoneyLion is their rewards program, which is what we’ll discuss next.
The MoneyLion Rewards Program
Every time you “display financial responsibility” with your MoneyLion account, you’ll earn points that can be redeemed for various rewards, such as gift cards to popular stores like Best Buy, Starbucks, Amazon.com, and more—even up to a 25% discount on your loan’s APR.
To do this, there are four statuses within the MoneyLion network: Bronze, Silver, Gold, and Platinum. As you earn more points and move up the ranks, you’ll be eligible for bigger discounts.
According to MoneyLion’s chart located on their website, you can earn rewards with as little as 2,500 points.
Important note: The rate reductions above are percentages off the APR—not discounts off the APR itself. For example, if you qualify for an APR of 20% and are a Bronze member, then your resulting APR will be 18% (not 10%). Points have no expiration date.
Money & Wealth Management
Typically, when you hear the phrase ‘wealth management,’ you probably imagine highly-trained financial professionals carefully managing lots of money for wealthy clients, similar to WealthFront, Schwab Intelligent Portfolios, and the like.
However, that’s not what MoneyLion is referencing when using the term. Instead, their iPhone and Android apps can help you:
- View transactions across all your accounts
- Identify spending categories, track expenses, and stay on budget
- Track your savings and net worth over time, updated daily
- Receive mobile alerts if unusual spending is noted on your account, or if your bank balance drops too low (avoid bank fees!)
In other words, while these features are no doubt helpful, we think it’s a long shot classifying MoneyLion’s apps as wealth management tools. Instead, it seems more like a way of managing your personal loans through the company.
TransUnion Credit Monitoring
MoneyLion’s credit monitoring service is provided free of charge through TransUnion, and is available whether you’re a MoneyLion customer or not. To enroll, simply enter some basic information and confirm your identity.
Then, MoneyLion promises to deliver your credit score “in seconds” and provide a comprehensive analysis of important factors related to your credit. On top of this, you’ll be able to keep track of your credit, simulate how your financial decisions affect it (e.g. taking out a new loan, transferring a balance to a new card, paying off all your cards, etc.), and get real time alerts whenever changes occur to your account.
Credit Card Reviews
Here, you’ll find dozens of different credit cards available for review; everything from balance transfer cards to ones with low APRs.
What Are MoneyLion’s Customers Reviews Saying?
Moneylion, Inc. based out of New York, NY (with offices in San Francisco and Kuala Lumpur), has been in business since April 2014. Although they claim to have originated over 100,000 loans, there was very little online feedback for the company at the time of our research.
We did find 3 reviews on SuperMoney.com (two of which appeared to be duplicates), referencing long wait times and declinations. Other than that, nothing.
As far as their apps, the iDevice version had an average rating of 4.5 stars based on 13 reviews. Most compliments seemed to reference ease of use (it appears to display much of the same information found in your personal dashboard) and solid design. On the other hand, their Android version only had a 2-star average rating, based on complaints of crashing.
Are Personal Loans a Good Idea?
There’s a whole lot we’re not told about MoneyLion (e.g. real-world APRs, repayment terms, fee schedule, etc.), but in general, most financial professionals recommend avoiding personal loans. Why?
Unlike mortgages, which use your home as collateral, or auto loans that use your car, personal loans are often unsecured. As a result, they tend to come with excessively high interest rates that can add thousands to your repayment amount, and even keep you trapped in a cycle of debt in some instances. Sure, they come with few stipulations, but you’ll pay (often greatly) for the convenience.
However, if you’re looking to consolidate credit cards, refinance student loans, improve your credit, or pay for a large expense like a wedding (as long as the interest rate is lower than your credit cards), personal loans might not be a bad idea. Just make sure you only take out exactly what you need and pay it off as quickly as possible.
Is MoneyLion Just a Fancy Payday Lender?
MoneyLion tells us that they “use machine learning based algorithms and big data analytics to understand the financial needs of our clients and offer better rates than traditional lenders.” Without knowing exactly what these rates are, though, there’s no way to verify this claim.
We can say that dozens of lenders are hopping on this new “algorithm” bandwagon, aimed at streamlining the application and approval process and getting customers their money faster. Often times, they also pass saved labor costs on to their clients in the form of lower interest rates. Popular examples include Rocket Mortgage, LendKey, and LightStream Loans.
Compared to other personal lending options, MoneyLion seems to focus on helping their customers maintain good credit and make smarter financial decisions, and their rewards program can help customers score lower interest rates on future loans. Again though, without knowing how many points you’ll receive for different actions, there’s no way to grasp in advance how long it’ll take you to achieve any of these rewards—or if it will be worth the time and effort.
Given this, as well as the general concerns surrounding personal loans and lack of online customer feedback, we might recommend applying for a MoneyLion loan—but only after you have all the important details in front of you, and you’re sure you can quickly pay it off.
Instead of leaving other potential customers in the dark, tell us about your experience with MoneyLion by writing a review below!