February 24, 2025
SoLo Funds Welcomes CFPB’s Lawsuit Dismissal
Data From The 2025 Cash Poor Report Shows That SoLo Is The Most Affordable Solution For Borrowing Money
Los Angeles, CA. February 24, 2025 – SoLo, the US’s largest community finance platform that’s powered by people, is pleased to announce the CFPB has dismissed its lawsuit against SoLo Funds with prejudice.
The discovery in the lawsuit showed the CFPB that for a $100 loan on the SoLo platform, the average tip offered is $10.40, and the average donation offered is $6.20 – collectively, less than half the cost of an overdraft fee or bounced check. SoLo encourages responsible use of the platform. Loans cannot be refinanced, rolled over, or extended, avoiding the phenomenon of hidden debt traps. Borrowers may only obtain one loan at a time. If borrowers cannot repay their loan on time, they have a multi-week grace period before a one-time late fee is assessed. The unpaid amounts do not compound or accrue interest – the borrower owes the same amount on the 45th day of delinquency that they would owe on the 450th day of delinquency.
Following this and the Bureau’s prior efforts to withhold exculpatory evidence from SoLo, the Bureau and SoLo reached an agreement to end the litigation. The Bureau noted its independent research showed that many working-class Americans with limited means faced unexpected medical bills, auto repairs & higher grocery bills, and SoLo took an innovative approach to meet these needs. The Acting Director expressed shock that the Agency ignored the benefits of SoLo and tried to destroy the company through prolonged litigation with no merit.
“As a disruptive fintech leader, SoLo, a certified benefit corporation, is proud to have over 2 million users that have injected $1 billion into working-class communities via its peer-to-peer community finance platform, and we look forward to continuing this critical work now that this costly litigation is behind us.” –Travis Holoway, CEO of SoLo Funds.
There is a reason why SoLo Funds is trusted and used by 2 million consumers. The borrower proposes the terms of loans requested and funded through the SoLo platform. The borrower may offer a fixed “tip” to the lender as a token of appreciation for funding the loan, and a fixed “donation” to the SoLo platform, but those amounts are optional and set by the borrower. Loans are issued to individuals by other individuals who see the needs in their community. Corporations cannot lend money or obtain loans on the SoLo platform. Tens of thousands of loans have been funded without the borrower offering a tip to the lender, and hundreds of thousands of loans have been financed with no SoLo donation.
Earlier this year, SoLo released The 2025 Cash Poor Report, which examines Americans living paycheck to paycheck and the total cost of borrowing money over a 12-month period from common options to cover unplanned expenses. The report revealed that Americans with little or no savings paid more than 39 billion dollars in fees–beyond the advertised Annual Percentage Rate (APR)–when seeking short-term capital, a 34% increase from 2023. Subprime credit cards emerged as the most expensive option again, while SoLo and other fintechs continued to rank as the most affordable options for the second consecutive year.
“SoLo’s perspective is that one of the most critical aspects of consumer protection is the consumer cost of capital and providing clear terms that a borrower can understand. It is a fact that loans with flat non-compounding costs are more affordable than interest-accruing costs over time. There’s a reason Americans currently hold over 1.2 trillion dollars in credit card debt. In deciding to bring this case against SoLo, the CFPB sought to shut SoLo down so underserved consumers could not get help to finance necessities such as groceries, rent, and utility bills. SoLo is thankful that when they examined the evidence in the case, they saw the benefit of SoLo’s innovative model. We remain hopeful that innovation will be rewarded where the goal is fostering competition and lowering consumer costs.” – Travis Holoway, CEO of SoLo Funds
For more information on SoLo Funds, visit https://solofunds.com or download our app on iOS and Android.
About SoLo Funds
SoLo is the largest community finance platform in the U.S – Where over 2 million members borrow on their own terms and lend to make industry-leading returns and a positive social impact. SoLo has emerged as a new financial services leader, delivering $1B to underserved working-class communities. The economic system has failed our communities, excluding them from returns and access to short-term credit. SoLo created something different, something more human. They returned to the basics, creating a community where people could financially support each other. SoLo calls this community finance.
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Brennan Nevada Johnson