Onward Financial Inc., a participant in the Fountain City Fintech accelerator program at NBKC Bank, won the Communities Thrive Challenge and will be awarded $1 million along with $40,000 in technical assistance. The challenge is put on by The Rockefeller Foundation and the Chan Zuckerberg Initiative, which is a charitable organization that Facebook CEO Mark Zuckerberg and his wife, Dr. Priscilla Chan, launched in 2015.
Founded in 2016 by CEO Ronnie Washington, Onward Financial was named a member of the first cohort for the Fountain City Fintech accelerator in September. It is the only nonprofit admitted to the program.
Washington, D.C.-based Onward Financial is an employer benefit program that provides education on saving, responsible borrowing and financial education to employees.
The organization addresses a key national problem: 47 percent of Americans can’t come up with $400 in case of an emergency. The group helps people learn how to save money and, once they’ve been active savers for at least three months, they become eligible to access short-term loans from Onward Financial that use their savings as collateral.
“Ronnie is solving one of the biggest and most foundational problems in the entire financial services industry,” said Zach Pettet, the accelerator’s managing director and a fintech strategist for NBKC Bank. “They’re shifting the need for people to take a payday loan with a 450 to 500 percent annual percentage rate, to the groups he’s working with being able to take out loans for 3 to 18 percent and they’re collateralized by savings they already have. So across the board it totally shifts the landscape of short-term lending in Kansas City, which is the payday loan capital of the world.”
Washington said Onward Financial wouldn’t have been able to make it this far if it wasn’t for Fountain City Fintech. He said he was considering shutting down the organization at the end of last year due to a lack of funding. But now they’ve been able to launch a mobile app in the Google Play Store, onboard new clients in the Kansas City area and raise nearly $1.4 million in funding.
“Any employer with a workforce earning less than $20 per hour, we’re looking to partner with them to offer Onward as a benefit to those folks and help them build a financial cushion,” Washington said. “We’ll be onboarding new employers as early as January of next year and are already engaging with some this year. We really do want to focus on the Kansas City area to start, so if there are employers out there who essentially want to offer financial security to their workforce, we encourage them to visit our site and sign up. We’ll be taking on new clients at the beginning of 2019.”
Pettet called Onward a shining example of what NBKC Bank is trying to accomplish with Fountain City Fintech.
The accelerator will host a demo day for all six members of the first cohort from 5:30 to 8 p.m. on Dec. 13 at NBKC Bank’s headquarters, 830 Ward Parkway in Kansas City.
