Borrowell Is a Fintech App That Helps Canadians Build Credit

Borrowell is best known as the app that offers free credit scores to Canadians. By signing up for this app you can check your credit score without doing a hard credit pull that could lower your credit score. Your credit score is provided by Equifax, one of the major credit reporting bureaus. Many banks don’t show you your credit score, and the bureaus only provide free credit scores periodically, so this app is useful for Canadians who want a way to constantly monitor their credit scores for free.

Borrowell’s Business Model

Borrowell is a loan comparison platform that earns money through affiliate marketing. It helps you compare loan offers from many Canadian banks at the same time. Borrowell can use your credit history to determine if you’d qualify for these loans as well. So you can use the app to find banks that will offer you loans with the lowest interest rates if you’re trying to build your credit. The app also helps you select the loan that’s best suited for borrowers in your position.

For Canadian banks, Borrowell acts as a lead generator. After you sign up for Borrowell, the platform shares your credit history with Canadian banks. And these banks will then send you loan offers. Banks pay Borrowell commissions for bringing them customers. And because of those commissions, Borrowell can provide credit scores and credit building advice for free. It even has an AI credit coach, Molly, who provides credit building advice.

The Platform Offers Many Types of Loans

Many people don’t like credit cards because of their high interest rates, and these users might not be interested in a platform that helps them choose credit cards. There are several well-known financial advisors, such as Dave Ramsey, who tell their clients to avoid credit card loans. But Borrowell also provides price comparison services for other types of loans, including secured loans that have much lower interest rates than unsecured loans.

For example, the Borrowell platform helps users compare auto loans and home improvement loans. It also includes small business loans and debt consolidation loans. So the platform is still useful for borrowers who don’t want to pay 20 percent interest on credit card loans. It can show you loans with lower interest rates designed for specific purposes.

Mogo Versus Borrowell

The Canadian neobank Mogo also offers free credit reports, so many Canadians see it as a competitor to Borrowell. Both Mogo and Borrowell show users their Equifax scores, they both help users build credit, and they both earn money through affiliate marketing by sending leads to their partner banks.

There are a few important differences between these fintechs, though. The main one is that Mogo provides free credit reports to customers with Mogo debit cards. One of the Mogo app store reviews mentions that Mogo originally showed all Canadians their credit scores for free, but now this feature is only available for Mogo’s customers. So Borrowell could be more useful for customers who don’t want to sign up for another debit card. Mogo does charge inactivity fees.

Mogo Versus Credit Karma

Credit Karma has the most similar business model to Borrowell. This app’s also focused on helping its users build credit and doesn’t provide other banking services directly. And it provides loan comparison services that generate leads for other financial services companies.

There are two main differences between Credit Karma and Borrowell. Credit Karma is a US company, although it does have a Canadian subsidiary. Both Borrowell and Mogo are Canadian companies. The other difference is that Credit Karma provides credit scores from TransUnion, a credit reporting bureau that competes with Equifax. Your TransUnion score may be different from your Equifax score.

All of These Companies Are Safe and Secure

Borrowell, Credit Karma, and Mogo are fintech startups with large customer bases. They’re regulated by the Canadian government and they have partnerships with major Canadian banks. The offers they show you are legitimate loan offers from regulated Canadian lenders. And the credit reports they show you come from the major credit bureaus Equifax and TransUnion. So safety and security aren’t relevant comparison factors between these companies, they all satisfy Canada’s financial regulations.

Conclusion

All three of these fintechs provide free credit score reports to their users. The main selling points for Borrowell are that the fintech is based in Canada and it doesn’t require you to sign up for a separate neobank account. Most neobanks operate at a loss so they have been adding fees recently. And features like credit reports may be further restricted.

Recently, several neobanks have introduced premium service tiers so customers have to pay a monthly fee to access non-core account features. And it’s possible that credit reports could become one of these premium features. For the time being, though, Mogo still provides free credit reports to its users.