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Startup ZestFinance today announced Basix, a new program for giving loans online to people with what it calls “near-prime” credit history — those who are ineligible for a loan from a bank by just a little bit.

People anywhere in the U.S. will eventually be able to take out a loan through Basix, but ZestFinance is initially rolling out the service in Alabama, Georgia, Missouri, New Mexico, and Utah, with a range of $3,000-5,000 per loan. The loans are available on a three-year term at 26-36 percent annual percentage rates (APR). ZestFinance will provide data to credit rating agencies about whether people pay back the loans.

The startup uses machine learning to determine, based on many data sources, whether people are eligible for loans — and now other companies can take advantage of this information to loan money to people who might otherwise be out of consideration.

In addition to operating Basix, ZestFinance is making the underlying technology available for other lenders to use.

ZestFinance last announced funding — a $20 million round — in 2013. Investors include Peter Thiel, Northgate Capital, Lightspeed Venture Partners, Matrix Venture Partners, Kensington Capital Holdings, and Eastward Capital Partners.

ZestFinance, formerly known as ZestCash, started in 2009 and is based in Los Angeles. The ZestCash service is still available in some states, but the new Basix program will give out larger amounts of money.


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