Study

Consumers Disproportionately Experienced Financial Impacts of COVID-19

Elevate Credit, Inc. (NYSE: ELVT) (“Elevate”), a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, and SpringFour, the only social impact fintech platform that helps financial institutions give customers the support they need to regain financial control, today announced the findings of a research study examining the financial effects of the COVID-19 pandemic on American households. The study, which was co-authored by Elevate and SpringFour, found that the pandemic’s impact on American households was uneven, and that those who struggled require support beyond what traditional financial institutions provide.

The study analyzed data collected by Elevate’s internal thinktank, the Center for the New Middle Class (“CNMC”), which surveys prime and non-prime consumers monthly to understand the behaviors, attitudes, and challenges of this growing demographic. CNMC defines prime as those with credit scores above 700 and non-prime as those below 700. The study also analyzes SpringFour data on demand for financial resources in over 30 categories of need, in addition to SpringFour survey data on impacts of the pandemic.

Among the 10,580 people who were surveyed by CNMC, the following key findings emerged:

• Approximately 20% of respondents reported a job loss over the past year.
• Of the 20% who reported a job loss over the past year, 75% of both prime and non-prime respondents said that the job loss or furlough was due to the pandemic.
• Non-prime consumers overall were much more likely to spend a portion of their stimulus on basic needs like food, utilities, housing or medical costs.
• Approximately 50% of non-prime consumers reported spending their stimulus checks on food or groceries versus less than one third of prime consumers.
• Twice the percentage of non-prime consumers spent funds on housing than prime consumers.
• Prime households were much more likely to use stimulus funds for savings than non-prime. This suggests that prime households have achieved increased financial stability and are better prepared for unforeseen expenses.

“The income volatility that resulted from the pandemic put many already financially vulnerable Americans into an even more challenging situation. While we can’t predict when unexpected events such as the pandemic will occur, we can be better prepared. That means equipping both prime and non-prime Americans with the tools and resources they need to make informed decisions about their finances so that they can meet their basic needs, reach their savings goals, and achieve long-term financial stability,” said Jason Harvison, CEO of Elevate.