Zero Financial is a fintech startup that combines the convenience of debit cards with the rewards potential of credit cards. A Zero account is a variation on the cash management theme, providing a checking account that works together with an associated credit card — the Zerocard. Zero offers up to 3% cashback on Zerocard purchases, and promises “zero fees.”
With Zero, you make all purchases and ATM withdrawals on the Zerocard line of credit, and the system pays off the credit balance at the end of each monthly billing cycle, out of your Zero Checking debit account. Key to the whole scheme is the smartphone app, which provides a dashboard for the entire checking/credit hybrid account and should users a more accurate picture of what they are spending and what they can afford.
Does all this sound a bit counter-intuitive? We thought so, but once you grasp the concept it begins to make sense, and there’s no question that Zero offers a possibly useful cash management experience. Note that like many fintechs, Zero is not a bank itself. It partners with WebBank to provide the Zerocard Mastercard and with Evolve Bank & Trust to offer and insure Zero Checking deposits.
Zero calls its unique offering “the debit-style experience.” This experience, it says, provides user with the spending discipline of a debit card and the high cashback possibilities of a credit card. By blurring the lines between the two, Zero ends up with a product similar to a cashback rewards debit card, but unlike anything else available on the market today.
With Zero, you pay for everything with the Zerocard credit card, using its unlimited line of credit. With every purchase, the amount spent shows up on the Zero app as “deducted” from your Zero Checking balance. In actuality, the funds in your Zero Checking account pay off the credit card balance at the end of each monthly billing cycle.
By unifying your credit purchases and checking deposits, as well as your cashback rewards — as you can see in the screenshot — Zero provides a virtual accounting of all deposits and spending. Zero wants you to be able to see exactly what you’ve spent and how much money you have left in your account balance after purchases — even though the card credit balance is in actuality paid off at the end of the month.
Then around bill time, Zero ensures you never miss a payment when you’re enrolled in the debit-style experience (yes, you can de-activate the “experience”; more on that below). You do receive a monthly bill, although Zero automatically pays off your purchases in full, using the funds from your Zero Checking account.
Zero charges zero fees for ATM withdrawals, account maintenance, bill pay, account inactivity and foreign currency transactions. You’re allowed to use any ATM of your choice without being charged a fee from Zero, but you’re still on the hook for the ATM owner’s surcharge, which Zero will not refund unless you are at the highest membership level (more on that below).
Because of the unusual structure of the Zero account, an ATM withdrawal is technically a cash advance against a line of credit rather than a cash withdrawal from a checking account. When you withdraw cash at an ATM using your Zerocard, it’s added to the amount repaid monthly from your Zero Checking balance.
There’s a catch, however. Zerocard is still a credit card, and it lets you choose to either enable the “debit card experience” — so the system pays off your spending every month in full — or turn off the “debit style experience.” If you choose the latter, Zero charges a hefty APR of 24.99% on any accrued balance. In addition, any ATM withdrawals you make start accruing interest charges at the APR rate on the transaction date. Also note that the APR is charged for any balance transfers from other credit cards, no matter whether the “debit-style experience” is turned on or off.
Zerocard APR and fees |
|
---|---|
APR |
24.99% |
ATM fees |
No ATM fees, unless the “debit-style experience” is turned off, in which case balances from ATM withdrawals are charged the 24.99% APR starting from the transaction date |
Late payment |
Up to $27 |
Return payment |
Up to $25 |
Also, when you flip off the “debit-style experience,” Zero will charge for late or returned payments. All in all, it seems clear that you’re best off using Zero as intended by enabling the “debit-style experience.”
The Zerocard earns unlimited cash back on all accounts, without any special rotating categories. There are four different levels that determine your rate of cashback rewards:
Zero’s referral program offers customers the chance to rise to higher-earning levels without having to meet high minimum spending thresholds. Potential users need to understand that simply sending a referral link to a friend isn’t enough to qualify. Your friends must apply and get approved for their own Zero accounts, make two qualifying purchases with Zerocard and receive two qualifying direct deposits to their Zero Checking account, no less than 30 days apart.
Rewards are allocated each billing cycle on or soon after each payment due date. Once rewards are eligible for redemption, you can redeem them at any time through the app. Rewards do not expire for the life of the account. Note that you can only earn cash back rewards on purchases made with your Zerocard. It does not apply to non-card purchase transactions, such as balance transfers.
Zero has a couple features “coming soon,” as well. This includes the ability to deposit and send paper checks into your Zero Checking account, both directly through the Zero app. Mobile payment capabilities, such as Apple Wallet, are also coming soon. Zero does not currently offer joint accounts or the ability to make cash deposits. Another biggie: You can’t deposit cash directly into your Zero Checking account.
Zero is currently accepting “early access” applications to join the waitlist. This simply requires your email address. When Zero is ready for you to apply, you’ll receive an email at the address you provide. You can submit your email online at Zero’s website or on the Zero app, which is available only in the Apple App Store.
To apply, you will need to provide your full legal name, U.S. physical address, date of birth, tax identification number (e.g., social security number), phone number, email address and a copy of government-issued photo identification. You must also provide your annual income, satisfy certain underwriting criteria and pass a credit check.
Zerocard approval requires you to be a legal resident of the United States with a physical U.S. address, at least 18 years old and have a valid social security number. Zero invites those with little to no credit history to still apply, although you will still need to satisfy certain underwriting criteria and pass a credit check.
Zerocard is designed to simplify the management of separate credit and checking accounts. If you find that you have trouble juggling spending between checking and credit accounts, Zero might help. You automatically see credit card purchases deducted from your checking balance, making it easier to determine what you can actually afford. And Zero automatically pays off your credit card balance in full every month.
When used properly, Zero’s best features can help you stay in budget and out of debt. But remember, Zero is intended for personal and household use rather than business spending. Zero analyzes its customer accounts to identify any patterns they deem inconsistent with personal use. If they find that you are using a Zerocard for reasons other than personal use, they reserve the right to close your account.
<span class="fn" data-placement="bottom" data-content="
Disclaimer:
LendingTree is our parent company. LendingTree is unique in that you may be able to compare up to five personal loan offers within minutes. Everything is done online and you may be pre-qualified by lenders without impacting your credit score. LendingTree is not a lender.
” data-original-title title>Disclaimer
<span class="fn" data-placement="bottom" data-content="
Advertiser Disclosure:
A Personal Loan can offer funds relatively quickly once you qualify you could have your funds within a few days to a week. A loan can be fixed for a term and rate or variable with fluctuating amount due and rate assessed, be sure to speak with your loan officer about the actual term and rate you may qualify for based on your credit history and ability to repay the loan. A personal loan can assist in paying off high-interest rate balances with one fixed term payment, so it is important that you try to obtain a fixed term and rate if your goal is to reduce your debt. Some lenders may require that you have an account with them already and for a prescribed period of time in order to qualify for better rates on their personal loan products. Lenders may charge an origination fee generally around 1% of the amount sought. Be sure to ask about all fees, costs and terms associated with each loan product. Loan amounts of $1,000 up to $50,000 are available through participating lenders; however, your state, credit history, credit score, personal financial situation, and lender underwriting criteria can impact the amount, fees, terms and rates offered. Ask your loan officer for details.
As of 28-Feb-2019, LendingTree Personal Loan consumers were seeing match rates as low as 3.99% (3.99% APR) on a $10,000 loan amount for a term of three (3) years. Rates and APRs were based on a self-identified credit score of 700 or higher, zero down payment, origination fees of $0 to $100 (depending on loan amount and term selected).
” data-original-title title>Advertiser Disclosure
As low as 3.99% APR
VIEW OFFERS
<span class="fn" data-placement="bottom" data-content="
Advertiser Disclosure:
Fixed rates from 5.990% APR to 16.240% APR (with AutoPay). Variable rates from 5.74% APR to 14.700% APR (with AutoPay). SoFi rate ranges are current as of March 18, 2019 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. See APR examples and terms. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 5.74% APR assumes current 1-month LIBOR rate of 2.43% plus 4.28% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.
All rates, terms, and figures are subject to change by the lender without notice. For the most up-to-date information, visit the lender's website directly. To check the rates and terms you qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull.
SoFi Personal Loans are not available to residents of MS. Minimum loan requirements might be higher than $5,000 in specific states due to legal requirements. Fixed and variable-rate caps may be lower in some states due to legal requirements and may impact your eligibility to qualify for a SoFi loan.
If you lose your job through no fault of your own, you may apply for Unemployment Protection. SoFi will suspend your monthly SoFi loan payments and provide job placement assistance during your forbearance period. Interest will continue to accrue and will be added to your principal balance at the end of each forbearance period, to the extent permitted by applicable law. Benefits are offered in three month increments, and capped at 12 months, in aggregate, over the life of the loan. To be eligible for this assistance you must provide proof that you have applied for and are eligible for unemployment compensation, and you must actively work with our Career Advisory Group to look for new employment. If the loan is co-signed the unemployment protection applies where both the borrower and cosigner lose their job and meet conditions.
Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Financing Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
” data-original-title title>Advertiser Disclosure
5.99% To 16.74% APR
SEE OFFERS
<span class="fn" data-placement="bottom" data-content="
Advertiser Disclosure:
Your loan terms are not guaranteed and are subject to our verification of your identity and credit information. To obtain a loan, you must submit additional documentation including an application that may affect your credit score. Rates will vary based on many factors, such as your creditworthiness (for example, credit score and credit history) and the length of your loan (for example, rates for 36 month loans are generally lower than rates for 72 month loans).Your maximum loan amount may vary depending on your loan purpose, income and creditworthiness. Your verifiable income must support your ability to repay your loan. Marcus by Goldman Sachs is a brand of Goldman Sachs Bank USA and all loans are issued by Goldman Sachs Bank USA, Salt Lake City Branch. Applications are subject to additional terms and conditions. For New York residents, rates range from 5.99% to 24.99% APR.
” data-original-title title>Advertiser Disclosure
5.99% To 28.99% APR
SEE OFFERS
<span class="fn" data-placement="bottom" data-content="
Advertiser Disclosure:
Your APR may differ based on loan purpose, amount, term, and your credit profile. Rate is quoted with AutoPay discount, which is only available when you select AutoPay prior to loan funding. Rates under the invoicing option are 0.50% higher. Subject to credit approval. Conditions and limitations apply. Advertised rates and terms are subject to change without notice. Payment example: Monthly payments for a $10,000 loan at 3.99% APR with a term of 3 years would result in 36 monthly payments of $295.20.
” data-original-title title>Advertiser Disclosure
3.99% To 16.99% APR
SEE OFFERS
Recommended by
This Cash Back Number May Surprise You
Best Travel Credit Cards With No Annual Fee
Getting Approved For 1 Of These Credit Cards Means You Have Excellent Credit
Credit Cards Charging 0% Interest until 2021
Source: https://www.magnifymoney.com/blog/banking/zero-financial-zerocard-review/