After Christian Zimmerman paid off his $4,000 credit card debt, he helped other borrowers collectively pay down more than $2 million.
How does he do it? Using an updated throwback — the piggy bank, but digital. The 25-year-old of Atlanta, Georgia founded his app Qoins, that rounds debit card charges to the nearest dollar, and applies the balance toward credit cards and loans.
“After graduation, I was making only minimum payments on my student loans, but I also had credit card debt,” Zimmerman told Debt.com. “I was trying to make additional payments toward my student loans because the grace period ended. My problem wasn’t so much saving, but more so making that additional payment. I thought ‘well if I made the additional payment without thinking about it, I’d probably feel happier about it.'”
Qoins: a digital change jar
To solve his debt payment problem, Zimmerman launched the Qoins app — like coins but with a Q — in 2017.
Users download it from the iOS App Store or Google Play. You add your name, phone number, and email, then the accounts that you want Qoins to take change from and add to. The app monitors your checking, or “funding” account, for regular charges and rounds them up to the nearest dollar. When you’ve made enough charges that add up to $5.00 worth of change, the app transfers it from the “funding” account, and stores it in your Qoins account. At the end of the month, Qoins uses the accumulated change to pay your lender.
So if you pump $19.50 worth of gas, Qoins rounds it to $20 and takes the 50 cents. And the same with every other purchase you make with that account.
Qoins charges a monthly $2.99 service fee, but it takes that fee from the change you’ve saved instead of charging your checking account.
“You just set it and forget it,” Zimmerman says.”People like to log in to the app just to see the impact they make every month. [Users are] also notified via text and push notification throughout the month whenever a withdrawal or payment is being made toward your Qoins account and your lender.”
And by impact, he means about $50. That’s how much Zimmerman says the average Qoins user pays toward their debt accounts every month. He says most Qoins app users pay off an additional $1,100 of debt a year.
Is Qoins safe to use?
Qoins services over 6,200 users with over 7,600 accounts. The app has helped those users collectively pay off more than $2 million worth of credit cards and loans to date. And their money is FDIC insured, just like a checking account, according to Zimmerman.
Qoins insures funds in users’ accounts up to $250,000 in case of money laundering or other mishaps. And it secures your personal information.
“We don’t store sensitive data such as banking information for protection purposes,” Zimmerman says. “We use it one time and you’re able to log in. Each credential is given a unique code that changes every 24 hours to make sure accounts are secured.”
Where is Qoins headed?
Zimmerman says the app is moving toward allowing multiple users on one Qoins account. He hopes by doing so parents can add their spare change to their child’s student loans while they’re in college.
“We’re working on a feature where you can crowdsource your debt through friends and family,” Zimmerman says. “I can actually invite my parents to start connecting the cards that they use on a daily basis. So if they average $50 a month, that’s $100 for both parents while their child is in school. The goal is to remove a lot of principal on the student loan debt by the time that they graduate from college.