We talked to Megha Agarwal of Neon about the one-stop bill pay solution, and she had the following to say:-
First of all, how are you and your family doing in these COVID-19 times?
Megha Agarwal: This year has been unexpected and tough for everyone, and it was no different for us. We’ve had some tough moments, but they’ve only reminded me of the resilience of people around me and that I am not alone in this – which has helped me stay positive through the ups and downs. I have developed a genuine appreciation for the smallest things in life and continue to be thankful for my family and friends’ health and well-being.
Tell us about you, your career, how you founded Neon.
Megha Agarwal: My cofounder and I are building Neon—a one-stop bill pay solution for essential household or business bills such as rent, utilities, and insurance.
The origin story relates to the pain points we were trying to solve. When it comes to essential bill payments, an average household in America pays over 4,500 bills over their lifetime, spending over $1M in total and 600 hours or more (equivalent to 75 days’ worth of productive time) tracking and paying bills. Yet, there is not one platform today that does it all — i.e., gives you the option of borrowing money, consolidating bills, tracking bill trends, and automating payments — in one place.
Moreover, when you look at the lending ecosystem today, the cost of credit for non-essential purchases has gone down significantly. You have companies like Klarna and Affirm offering interest-free, “Pay in 4” options for non-essential purchases like a fancy recliner or a new gadget. But when it comes to most essential bill payments, most households struggle to get credit at terms that feel fair and reasonable, much less at 0% APR.
So, we decided to build a single platform, a “set it and forget it” service, that would take the stress out of bill payments by doing all the work for you while allowing you to stay debt-free.
How does Neon innovate?
Megha Agarwal: For us, innovation is centered around building a frictionless bill payment experience for our users. To that end, we have built our own proprietary technology to connect to various utility service providers to extract bill information and process payments.
We also want to lower barriers to lending and provide credit at 0% APR to all users irrespective of their credit scores or income levels, so we are leveraging alternative sources of data for underwriting. Lastly, we have structured our product differently from traditional lending products. We provide a monthly credit line that automatically renews every month as far as users pay us on-time. This allows us to incentivize responsible financial behavior, lower defaults, and help our users stay debt-free while reducing losses.
How the coronavirus pandemic affects your business, and how are you coping?
Megha Agarwal: We have seen a surge in demand during this time. People have been struggling to pay their bills on time as they’ve lost jobs or as their businesses have struggled. We ran a beta from May to September this year and had to close it – just because we had too many signups but only limited capacity to support users. We are now growing our team and building the infrastructure that would allow us to scale Neon to many more users that are currently on our waitlist.
How do you deal with stress and anxiety?
Megha Agarwal: I try not to worry about things I can’t control and act on the things I can change or contribute to. I feel, both in life and in business, things don’t go your way, and you are constantly dealing with the unexpected. For me, it’s important to know that amidst all this, I didn’t miss out on doing things that were important to me. So, I try to ask myself what I want from my life, who and what matters the most, and then I give it my best shot. I spend my time doing stuff that makes me happy and a big part of this for me is staying connected to my family. I try my best to make sure that I do not miss out on important moments with them today, just because I had too much on my plate to worry about.
Who are your competitors? And how do you plan to stay in the game?
Megha Agarwal: We face competition from traditional lenders, bill consolidators, and newer fintech players that offer cash-advance, early-pay, and overdraft protection to users. We’re focusing our energy on listening to our users, solving their pain points, and building something they really want.
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