A new app has launched that will allow friends and family to borrow from and lend to one another on Facebook.
The Agree It app is freely downloadable and will not charge users fees of any kind. The App will generate revenue solely through advertising. Borrowers identify suitable lenders for themselves and vice versa, and the two then settle upon a mutually agreeable rate. In other words, users have complete control of the matchmaking process. Loans may be sought for personal use or as business funding via the app.
Omar Fansa, the Founder of Agree It, commented:
"Poor credit ratings and a reluctance to ask for help closer to home means UK residents are increasingly taking on unsustainable debt that ruins lives. By seeking and offering funds within our social network, we can sidestep expensive credit and poor deposit rates and enable borrowing between friends and family at affordable rates.”
The Agree It app serves as a reminder that the majority of alternative finance platforms, though hailed as disintermediating forces themselves, are in fact a form of intermediary.
But the status “intermediary” is not by default a black mark. The presence of an intermediary also engenders increased security for both parties involved in the lending transaction. On Agree It, there will be no legal obligation to repay funds once lent. The service offered by the app is a purely social contract – and Fansa himself has advised lenders only to give money to trustworthy friends.
The app could take off as the go-to for people with poor-credit ratings, but there is a reason credit ratings exist. We will have to wait and see how much of an effect friendship-ties will have on limiting defaults. However, as an alternative to the often exploitative payday loans outfits, Agree It represents a promising proposition.