The process of paying bills isn’t easy however the last two years of hardships have made it more difficult. Promise cooperates with utilities as well as government agencies to offer flexible payment options for people who are unable to pay their entire electric or water bill in one go. The company has experienced massive growth through 2021 and recently raised the sum of $25 million in a B round to continue its growth.
Promise collaborates in conjunction with government agencies as well as other organisations which collect everything including utility bill to licensing fees. The payment methods for these types of payments are extremely rigid and do not account for fluctuation in income or cash free; Promise provides a plug-and-play installment plan that is interest-free to pay for an electric bill.
“For people who have funds, we would like systems that allow as much flexibility as is possible however for the poor, that’s not the way it works. If you don’t pay your bill by the 5th of May, you won’t receive the service and you’ll pay the price,” said Phaedra Ellis-Lamkins who is the CEO and founder of Promise. If you don’t pay your commercial driver’s license fees on time, and you’re not granted the license, which means you won’t be able to work for the money needed to purchase the driver’s license or the gas bill, and you’ll have late fees, etc. In the midst of a lot of fiscal uncertainty, this flexibility isn’t the best idea.
Ellis-Lamkins said that the older methods are based on the belief that if a person isn’t paying the bill, it’s because they don’t want toand are penalized by fees and interest, or forced to sign up for the most predatory option, such as payday loan companies. Promise has a different perspective.
“Our hypothesis is that fundamentally, people aren’t able payand it’s not an option,” she said. “If you create an environment that is more beneficial for people, they’ll pay.”
This theory is supported by data areas where the majority of people were living with the burden of government debt suddenly paying the debt at rates that were higher than 90 percent. “The research behind our work is becoming more and more efficient,” she added. The government has recognized that it’s sensible to sign up to a service that makes it much more likely that money will be earned.
We spoke with Promise about a time ago when the company raised $15 million to increase its operations and has since expanded. The year saw revenue and its customers (that is to say utility customers rather than customers who pay bills) grow by 45x and 32x respectively. It also said that in the first few weeks of 2021 it had scheduled multiples of the same multiples.
I asked her what the growth would look like. “It appears to be adding child support, it appears similar to adding ticket tickets for parkingWe have a diverse clientele,” she said. “We simply want people to not be impacted by the negative effects of debt from the government and we don’t want anyone to have to pay for interest. We’ve become proficient at getting money into the system but we’ve also hoped to improve our skills in getting the cash out.”
According to her the Promise’s direct connection with an entity like a utility provides them with information about things such as government subsidies or stimulus checks. For many, obtaining cash or discount given to them in a formal way requires filing out forms on paper including tax returns and visiting a location in person. It’s not ideal even in non-pandemic circumstances. The government agencies know which individuals are eligible, but they don’t notify them in advance — which is what Promise takes action in their place.
For clarity, it is the money that local and state governments would like to distribute budget items or federal funds that could be lost if it is not given. Like any bureaucracy neither speed nor communications are their forte. In an Louisville investigation, Promise offered 10 times the amount that local authorities received in less or more cases by sending people a text message asking them to “come and collect it.”
The positive effect of Promise’s work is that it put pressure on lenders and collection agencies who made a living from the poor and struggling. Many will be disappointed to see these shady business models relegated to desperate conditions, similar to the victims they target.
It becomes apparent that you’re catching more fly (and bills) by using honey Local governments are sign-up as well as paying subscription costs which offer Promise with revenue. Users don’t have to pay. The $25 million of funding will be used to hire the staff needed to manage all the new customers. It will also Ellis-Lamkins was not willing to provide specific details expanding the business to processing payments to the Feds. That’s a lot of fish to catch and we should anticipate Promise to continue growing.
This round was led by The General Partnership, with participation from Kapor Capital, XYZ Ventures, Bronze Investments, First Round Capital, Y Combinator, Howard Schultz and others.
