ilumoni, the fintech startup helping people to borrow better, save on unnecessary interest and time in paying off debts has raised $450,000 pre-seed investment backed by Move Ventures (formed by the founders of Market Gravity, acquired by Deloitte in 2017), and angel investors including Simon Moran, former CMO and now Non Executive Director, Premium Credit and Andy Deller, former CEO of Dunbar Bank plc, part of Zurich Insurance Group.
Founded in 2019, ilumoni is the UK’s first AI powered borrowing insights app which uses open banking and credit data combined with market information to build a fast, accurate and realistic picture of the user’s debt. The free app provides personal insights to help users take action and make important changes to their borrowing, based on analysis, affordability and eligibility. The insights appear as nudges, prompts and future scenarios based on manageable behaviour changes.
ilumoni’s approach to better borrowing and financial wellbeing has caught the attention of the Financial Conduct Authority which accepted the startup into its Innovation Hub last year. The FCA Innovation Hub is focused on encouraging innovation in financial services in the interests of consumers.
The key mission for ilumoni is to enable people to make better financial decisions arming them with the insights, analysis of the alternative options and guidance to borrow well. FCA data from 2016 showed that a quarter of all credit card holders paid just the minimum repayment each month. While this satisfies the terms of credit card companies, interest charges can add up. Through only making the minimum monthly payment, it would take the average person a quarter of a century to pay off the average credit card debt1.
However, fixing the repayment to the amount paid in the first month rather than reducing the monthly repayments would serve to clear the debt in just five years. Through combining open banking, credit and eligibility data, ilumoni builds a complete picture of the debt and produces insights to help users repay debts faster.
Example insights include exploring the repayment options available to the user such as fixed payments, one off overpayment, regular overpayment arrangements and switching out of uncompetitive loan or credit card products. The potential impact on fees and debt duration is also clearly presented to the user.
“Many consumers borrow without fully understanding their options or implications of their borrowing. This is further compounded with poor repayment habits. As a result, large numbers of consumers are in the dark about the true cost of their borrowing, paying more in interest and fees than necessary and carrying debt for longer. ilumoni is changing that by shining a light on how we borrow,” explained Gary Wigglesworth, co-founder and CEO, ilumoni who has a track record in banking firsts, including his role at internet bank Egg as one of the founding directors. Wigglesworth also co-founded digital identity security startup Garlik in 2006, which was later acquired by Experian.
Commenting on the investment, Andy Deller, former CEO, Dunbar Bank said, “There is a significant gap in the financial wellbeing app market. Current providers offer limited information without direction, or push products that don’t account for the overall wellbeing of the user. ilumoni demystifies debt and provides borrowers with clear and actionable insights that specifically suit their circumstances, helping consumers understand and manage their debt for the better.”
ilumoni is using the pre-seed investment to focus on product development and regulatory approval, and is preparing for a second fundraise to take the product to full market launch and beyond. ilumoni received direct FCA AISP (Account Information Service Provider) authorisation earlier this week and the beta product is due for release later this quarter. Early adopters are invited to register interest at ilumoni.com.