Colorful murals on the walls at Doc B’s in Uptown catch my attention as I sit down to lunch with Zirtue Founder and CEO Dennis Cail. Perusing the menu, he suggests the California Salad but opts for the Brussel Sprout Salad himself. “I’ve been wearing that California Salad out,” he explains with a laugh. His office is across the street, making him a frequent diner at the eatery.
It has been just over four years since he founded his relationship-based lending app, which formalizes loans between family and friends and promotes financial inclusion for the underbanked. The app processed more than $30 million in loans in 2021.
Zirtue’s success helped Cail land investments from the likes of Google and Northwestern Mutual; he also recently launched a debit card through a partnership with MasterCard. “It all centers around this: How can we give people a better hand up versus a handout?” he says.
Cail spent his early years living in low-income public housing in Monroe, Louisiana. There were no banks, he remembers, only liquor stores that would cash a check for a 20 or 30 percent cut. “Even at 7 or 8 years old, I knew that was bad math,” he recalls. After a tour with the Navy and earning two degrees at Southern Methodist University, Cail built e-commerce platforms for IBM.
Strains in relationships with family members caused by unpaid debts they owed him sparked the idea for Zirtue. Informal loans between friends and family are often fraught with conflict and miscommunication. “You become the bad guy all of a sudden,” Cail says. “It’s very awkward.”
Zirtue prompts users to create lending terms and payment schedules and link a funding source if available. The new debit card will provide a funding source for those who may not have access to a bank account while also building “an on-ramp to financial inclusion” by serving as a gateway to other credit-building products. Guidelines such as maximum loan amounts and a limit on the number of outstanding loans an individual can have help users build financial literacy and make sound decisions.
After the pandemic hit, Zirtue segued from a subscription-based model to generate revenue by focusing on B2B partnerships with companies such as energy and healthcare providers. It charges businesses a fee to funnel users’ funds to outstanding charges via direct bill pay, preventing bad debt for companies and helping users avoid service disruptions. “Zirtue is really that nexus that sits in between all of these relationships and these pain points,” Cail says.
Current business partners include AT&T, UT Southwestern, Southwestern Health Resources, and Reliant Energy.
Looking ahead, Cail hopes to launch a credit offering by the third quarter of 2022, giving underserved individuals a place to safely build credit based on their previous Zirtue performance. “We’re trying to help graduate people into more financial products,” he says. MasterCard will also help launch Zirtue into Latin America and Asia by Q4—part of a global buildout. “Once you get outside of the U.S., the problems and the opportunities expand,” Cail says.