Karma fintech tests interest-free payday advance app with Scottish government support


A fintech that aims to eliminate punitive payday loans by offering interest-free advances is being launched around the world after being tested in Scotland.

The Karma The smartphone app has been approved by the Scottish Government and is supported by the fintech cluster at the University of Edinburgh Bayes Center, the hub of data science and artificial intelligence.

Employers who sign up for the system can offer staff monthly salary advances of £ 300, which can be spent at fintech partner retailers including Tesco, Asda, Morrisons, Waitrose and Amazon.

It is supported by a social investor Capital Fortunis, whose Chief Strategy Officer for Scotland is David Russell of Edinburgh-based David Russell Consulting.

CEO Minck Hermans said, “We have not only built a solution, but we are starting a global movement, to disrupt the short-term consumer loan market and eradicate the pain it causes. Employers are rewarded with increased employee productivity and engagement, as well as the recognition that they are doing the right thing; employees have more control over their finances; and our business partners are rewarded with more business. Everybody wins.

“This will end the need for people to depend on crippling short-term loans for the most part, or face unforeseen costs, in order to close that gap before payday. Our completed tests in Scotland were overwhelmingly positive, as was the initial reaction from Scottish agencies and the tech industry. “

Consumer tests have been conducted on Karma, primarily with employers in the West of Scotland. Employees pay no interest or fees, and Karma says it could improve their credit rating.

Fortunis is in talks with the Bayes Center to discuss investment opportunities in Scottish companies and the possibility of founding Karma.

Fortunis chief operating officer Justin MacRae said he initially aimed to deploy up to £ 500million per year. He added: “Karma joined the industry accredited fintech cluster in Edinburgh, where he found a wealth of talent, an open and collaborative environment with the Bayes Center at the University of Edinburgh and a positive response from government groups. .

“With Scotland open to attracting technological investment in the country’s social capital, this is the perfect environment for ethical fintech companies like Karma to flourish. “

Ivan McKee, Scottish Minister for Trade, Investment and Innovation, said: “Scotland has a global reputation for attracting innovative companies like Karma and giving them the opportunity to grow and prosper. It’s a pleasure to welcome Karma here, especially as a fintech looking to solve a major societal challenge and improve the lives of Scots and the world.


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