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MoneyLion is a full-service financial services app that allows you to bank, invest, and borrow money in one place. Its goal is to make financial services more accessible for all customers.
This article will cover what MoneyLion is, its services, and how customers can use it as a one-stop shop for all their banking and investing needs.
Pros & Cons
- Low cost
- Wide array of product offerings
- Immediate access to loans via Instacash
- Automatically round up purchases to the nearest dollar and invest the difference
- Monthly maintenance fees
- Some benefits limited to Credit Builder Plus members
- Credit Builder loans have rates as high as 29.99%
What Does MoneyLion Offer?
MoneyLion is a mobile banking application that gives customers access to financial services at lower fees than you might find at a traditional bank or brokerage firm. They offer low-cost services such as cash advances, crypto investing, and small loans to help you rebuild your credit.
According to MoneyLion, it strives to work with customers with, on average, less than $2,000 in savings. These customers might not typically have access to financial advising or investment services. MoneyLion’s all-in-one platform and a wide array of products make banking and investing more accessible.
The FDIC-insured bank account RoarMoney is one of MoneyLion’s flagship services. Metabank supports it, and it gives account holders early access to paychecks. Debit card holders get fee-free withdrawals from a network of 55,000 ATMs.
MoneyLion offers a unique feature called Shake’n’bank. This rewards program allows RoarMoney account holders to earn cash back on eligible purchases of $10 or more made from a RoarMoney account by shaking their phone.
The rewards range from $0.01 to $500. After the user shakes their phone and reveals the reward, it is deposited into their MoneyLion Investment account. This rewards users every time they use their MoneyLion account.
Instacash is MoneyLion’s cash advance option. It allows users to borrow money from their future income with zero interest. The advanced amount is usually deducted from the deposited income within two weeks.
Borrowers do not have to have a RoarMoney account to use Instacash. They just need to connect a checking account. Standard Instacash advances are free and take 24-48 hours to appear in your account. However, if you want your cash immediately, you’ll have to pay a fee. For example, the fee is $3.99 for an advance deposited into a RoarMoney account, and a deposit made to an external bank account is $4.99.
Every time a deposit is made to the borrower’s linked checking account, MoneyLion increases the limit. The credit limit starts at $25 but increases to $250 as more deposits are made. Borrowers who have direct deposits into a RoarMoney account or join MoneyLion’s Credit Builder Plus program are eligible for a credit limit of up to $300.
MoneyLion’s flagship also offers investing accounts. These no-fee, no-minimum-balance accounts offer an auto-investing option. This automatic investing feature is designed to make investing a passive habit. Users simply select the amount they would like to invest regularly.
According to MoneyLion, 93% of its Plus members are also first-time investors. MoneyLion’s investing platform allows users to ease into investing. Users can choose from five different portfolios with asset allocations ranging from conservative to aggressive.
Unlike some brokerage firms and banks, which charge customers a percentage of assets under management, MoneyLion charges a flat monthly fee of $1. Additionally, users can make trades without paying a commission, similar to other mobile investing platforms like Robinhood.
In addition to investing, MoneyLion aims to increase accessibility to crypto. Zero Hash powers MoneyLion Crypto. Through Zero Hash, users can purchase either Bitcoin or Ethereum.
Users can automatically round up debit or credit card purchases to the nearest dollar and use that money to buy Bitcoin or Ethereum. RoarMoney account holders can buy and trade crypto just like they would on a centralized exchange like Coinbase.
MoneyLion Credit Builder Plus
MoneyLion offers a membership program called Credit Builder Plus. Members pay $19.99 monthly for access to small loans that help users build or rebuild their credit.
Credit Builder Plus members can access loans up to $1,000. Interest rates range from 5.99% up to 29.99%. Users immediately access a portion of their loan while the rest is held in a Credit Reserve Account. The loan functions as a line of credit. Payments are reported to the main credit bureaus, helping borrowers improve their credit scores.
Credit Builder Plus members are also eligible for other MoneyLion services, including Instacash advances and rewards. Members get exclusive access to the Lion’s Share Loyalty Program.
Rewards are based on how often members use the MoneyLion app and make qualifying purchases from their MoneyLion account. The Platinum reward level pays out $19.99, or the cost of joining the Credit Builder Plus program.
MoneyLion also offers GamePlan, a financial literacy service, to help users set and achieve financial goals. Once a user sets a goal, MoneyLion develops a personalized step-by-step plan for them to follow.
MoneyLion also provides tools within the app to help users track cash flow and set budgets. The app assigns users a score based on their saving and spending behavior. This allows users to understand their financial health and take action to improve it.
MoneyLion Fees & Pricing
While MoneyLion isn’t without fees, it is a low-cost alternative to traditional banking. Its flagship account RoarMoney costs $1 per month. Withdrawals from out-of-network ATMs cost $2.50. Electronic bill payments are free; however, paying with a paper check will cost account holders $2.50.
Investment accounts with less than $5,000 incur a maintenance fee of $1 per month. Accounts with more than $25,000 come with a $5 monthly fee. Trades on the platform are free.
Credit Builder Plus membership is $19.99 per month. Plus, members don’t pay the RoarMoney account and investment account fees. Additionally, members have access to the Lion’s Share Loyalty Program, where their monthly fees can be reduced further.
Instacash advances are 0% APR with no fees. Credit Builder loans range in APR from 5.99% to 29.99%.
Is MoneyLion Safe?
While the website is secure, the FDIC insures deposit accounts, private information is encrypted, and a global security team monitors the site 24/7, MoneyLion has come under scrutiny recently.
In September 2022, the Consumer Financial Protection Bureau announced it is suing MoneyLion for predatory behavior. The suit alleges that MoneyLion requires a Credit Builder Plus membership to access low-interest loans. Customers cannot cancel their membership until their loan is paid off, locking customers into paying fees for months. They are also accused of deceiving and overcharging service members and military dependents as well.
How Do I Contact MoneyLion?
MoneyLion is an online financial institution without any physical offices. However, they offer 24/7 customer support via chat, phone, or email. Their customer support number is +1 (888) 704-6970.
MoneyLion can be a great option as an all-in-one mobile banking platform. But when it comes to digital investing or building credit, there are other comparable platforms to choose from.
Identify your primary goal to choose a financial platform best suited for your needs. An all-in-one platform is nice to have, but it isn’t essential. The more bells and whistles a platform has, the more likely you will end up paying for it, one way or another.
CreditKarma is a financial services platform that strives to help customers improve their financial well-being. Its tools and online checking account are entirely free.
Similar to MoneyLion, CreditKarma offers a Credit Builder program. Working with SeedFi, CreditKarma will deposit a sum of money into a locked account on your behalf. Users repay SeedFi for the deposit, and the payments are then reported to the credit bureaus. This helps users rebuild their credit score while also helping them set aside cash in savings.
Chime is an online banking platform on a mission to make it easier for people to manage their money. Their accounts can be accessed online or via the mobile app and are free.
Chime also offers a Credit Builder option where users can set their credit limit using a secured credit card. The limit uses funds you already have, eliminating the risk of spending beyond your means. By using secured credit, Chime helps users reduce their credit utilization ratio.
Chime Disclosure – Chime is a financial technology company, not a bank. Banking services and debit card provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC.
1Save When I Get Paid automatically transfers 10% of your direct deposits of $500 or more from your Checking Account into your savings account.
^Round Ups automatically round up debit card purchases to the nearest dollar and transfer the round up from your Chime Checking Account to your savings account.
Chime Credit Building: To apply for Credit Builder, you must have received a single qualifying direct deposit of $200 or more to your Checking Account. The qualifying direct deposit must be made by your employer, payroll provider,gig economy payer, or benefits payer by Automated Clearing House (ACH) deposit OR original Credit Transaction (OCT). Bank ACH transfers, Pay Anyone transfers, verification or trial deposits from financial institutions, peer to peer transfers from services such as PayPal, Cash App, or Venmo, mobile check deposits, and cash loads or deposits, one-time direct deposits, such as tax refunds and other similar transactions, and any deposit to thich Chime deems to not be a qualifying direct deposits are not qualifying direct deposits.
On-time payment history can have a positive impact on your credit score. Late payment may negatively impact your credit score. Chime will report your activities to Transunion®, Experian®, and Equifax®. Impact on your credit may vary, as Credit scores are independently determined by credit bureaus based on a number of factors including the financial decisions you make with other financial services organizations.
MoneyLion is a low-cost, all-in-one banking platform that offers a wide range of services. Whether you are looking to rebuild your credit or dive into investing, MoneyLion has a product for you.
While MoneyLion is a good option, it isn’t totally fee-free. There are other comparable no-fee or low-fee options available. The main benefits of MoneyLion are its access to no-cost Instacash cash advances and Credit Builder micro-loans to help you rebuild your credit.
MoneyLion’s investing, and crypto offerings are also more limited than other competitors. This might not be a good platform for an experienced investor. However, for new investors looking for low-cost products and financial literacy training, MoneyLion could be a great option.