Oportun

Low-income consumers who find themselves suddenly in need of cash for things like medical bills or car repairs may not be able to get a quick loan from a traditional bank. Many then turn to payday lenders, which can trap borrowers in a cycle of debt with high fees and triple-digit interest rates. Oportun, a lending company that started out with a focus on serving the Latino community, offers a more responsible alternative. The company’s “sweet spot,” as a spokesperson puts it, is providing loans to the estimated 45 million Americans who have little or no credit history. By relying on other data, such as how long a person has had the same job or home address, Oportun assesses whether the loan is likely to get paid back—and has figured out how to turn a profit while providing more than $5.4 billion in loans to people who might be rejected by mainstream banks as too risky. Oportun’s loans are still more costly than credit cards, with an average APR around 35%, but experts say that’s a reasonable hedge. And there’s a bonus benefit for borrowers who make Oportun’s cut: it reports successful payments to credit bureaus. So far that has helped more than 600,000 customers establish credit scores, opening up their options for future borrowing.—Katy Steinmetz