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SoLo Funds payday loan alternative review

Borrow up to $1,000 without paying interest through this P2P lending app.

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SoLo Funds is an app that lets you easily borrow money from your peers, and pay for with tips rather than interest. But watch out for how much you tip — it’s easy to overestimate and end up paying as much as you would with a payday loan.

How does SoLo Funds work?

SoLo Funds is a simple app that allows you to borrow anywhere from $50 to $1,000 from your peers. To begin, you need to create an account and enter how much you’re willing to tip for the loan, when you want to repay it and how you plan to use the funds. SoLo states that even simple descriptions like “electricity bill” or “car repair” work far better than more generic ones like “bills” or “household necessities.”

After that, you have up to 30 days to wait for someone to fund your loan. If someone comes through, you’ll have between two and four weeks to repay it. Once your loan is repaid, your SoLo score — the measure SoLo uses to determine your creditworthiness — will increase. As you continue to borrow and repay, your score and history will increase, making it easier for future lenders to see that you’re a good investment.

  • Maximum borrowing amount: $1,000
  • Loan term: 14 to 30 days
  • Cost: Optional tip
  • Turnaround: Varies by lender and how your funds are disbursed

How fast can I receive my loan?

The time it takes to receive your loan depends on two factors: The day of the week the lender approves your loan and the method you and the lender use to transfer funds.

How repayments work with SoLo Funds

Repayments are automatic. On your due date — which you select when you make a loan request — SoLo makes two attempts to collect the amount due from your connected bank account. The more loans you borrow and repay on time, the higher your SoLo score will be. This helps potential lenders see that you’re a good borrower, which can increase your chances of getting another loan in the future.

If you’re unable to pay your loan at that time, you can request a rollover. This gives you an extra 14 days to repay the loan, but comes with a fee of $5 or 5% of the amount due — whichever is higher.

Still struggling to repay the loan? Then one of two things will happen:

  1. Your lender can choose to gift you your loan, meaning you’re off the hook for repayment.
  2. Your lender can decide to send your account to collections, which results in a $15 fee. This is reported to the credit bureaus and bans you from borrowing through SoLo in the future.

Become a lender with SoLo Funds

SoLo Funds isn’t just for borrowers. You can download the app and start lending money to your peers — earning tips along the way. You’ll be in complete control when it comes to how much you lend and who you lend to, but there are a few restrictions. SoLo has a $3,000 daily lending limit, and you’ll only be able to lend a total of $8,000 per month.

However, some lenders have reported faults in SoLo’s app, so carefully consider the risk before investing. Like any type of peer-to-peer (P2P) lending, you may not see a return on investment that’s worth the money you’re putting in.

How being an investor on SoLo Funds works

Compare SoLo Funds to online short-term loan providers

Data indicated here is updated regularly
Name Product Filter Values Max. Loan Amount Turnaround time Requirements
Fast5kLoans Short-term Loans Connection Service
As soon as the next business day
Regular source of income, verifiable bank account, US citizen, ages 18+
Get connected with multiple lenders you might qualify with — even if you have bad credit.
LendYou Short-term Loans
Same business day to 1 business days
$1,000+ monthly income, direct deposit, US citizen or permanent resident, ages 18+
Get offers from potential lenders in minutes by filling out just one online form.
Depending on lender requirements, people from all 50 states may not be eligible for a personal loan.
With straightforward, simple qualifications, these loans offer easy approval for people with poor credit.
Slam Dunk Loans
Same business day to 1 business days
Employed, $800+ regular monthly income, checking account, ages 18+, US citizen
Fill out a simple online form to compare offers from several lenders that may be able to help.
CashUSA Installment Loans
As fast as same business day
Regular source of income, bank account, US citizen or permanent resident, age of majority in your state
Explore its online education center to get tips on budgeting, how to prioritize your bills and more. Payday Loans
1 to 2 business days
Employed, $1,000+ monthly income after taxes, US citizen or permanent resident, ages 18+
Use its repayment calculator to see how the loan term and amount you borrow affects the overall cost.

Compare up to 4 providers

How much does it cost to use SoLo Funds?

Since SoLo Funds doesn’t charge any fees or interest to borrow, the main cost you need to worry about is how much you choose to tip. However, tip too much and you could end up with a loan that costs just as much as a payday loan.

Let’s take a look at an example. Say you take out a $200 loan with a $20 tip — which you’ll have to repay within two to four weeks. This can be just as expensive as a payday loan, which usually costs $10 to $15 for every $100 borrowed.

And just like short-term loans, you’ll also be on the hook for rollover and collection fees if you’re unable to pay back the loan on time.

What are the pros and cons of SoLo Funds?


  • No interest. Instead of charging interest and fees, SoLo lets you choose how much you’d like to tip your lender.
  • Loan extensions available. If you’re unable to repay your loan by the due date, SoLo offers a rollover option for a small fee.
  • No credit check. Rather than relying on your FICO score, SoLo Funds has its own system to determine your creditworthiness.
  • Loan could turn into a gift. If you aren’t able to pay back your loan, your lender has the option to either turn the loan into a gift or send it to collections.


  • Not guaranteed to find a lender. SoLo relies on a community of peer lenders to fund its loans, meaning you’re not guaranteed to find someone willing to help.
  • Short terms. Repayment terms range from 14 to 30 days, making this less than ideal for long-term financial problems.
  • Collections reported to credit bureaus. Unlike most short-term loans, failure to repay your loan could cause your credit score to take a hit.
  • Tips can be pricey. While a larger tip will help you stand out to a potential lender, it can make your loan just as expensive as a payday loan.

Is SoLo safe to use?

In general, yes — though no app can ensure your information stays 100% secure. However, SoLo does its part by encrypting any details you enter on both the app and its website. It also follows a standard privacy policy that outlines what personal information is collected, how it’s shared and what you can do to limit certain types of sharing.

Must read: Beware of risk for lenders

As of April 2019, SoLo Funds doesn’t have a safety net in place for lenders. According to multiple lender reviews, the collections process is paid for by taking a percentage out of the total repayment amount due — meaning you may be at risk of losing money if your borrower defaults. And while any investment runs the risk of a negative return, you may want to consider this carefully before lending to your peers through SoLo.

SoLo Funds reviews and complaints

So far, SoLo hasn’t earned the best reputation. Some lenders say they lost money and were upset SoLo did little to help them recover their funds.

And borrowers report struggles with payments going through properly — which can impact your credit rating — as well as bugs in the app and lackluster customer service. Many also had issues simply creating an account, stating the interface was frustrating and not user friendly.

SoLo Funds loan vs. payday loan

Although there’s no interest for a SoLo Funds loan, there are still plenty of similarities between these short-term options.

SoLo Funds loanPayday loan
Borrowing amount$50 to $1,000Typically up to $1,000, and most states allow only one at a time
Turnaround timeSame-day delivery available after approvalTypically next business day, but varies by lender
Application processDownload the app and connect your bank account and work scheduleSimple online application, typically requires Social Security number and bank account numbers
CostsOptional tip may result in a high APRHigh interest rate due to fees of $15 to $25 per $100 borrowed
AvailabilityAvailable in all 50 statesProhibited in some states

How do I use the app?

To get started as a borrower or a lender, download the SoLo Funds app from the App Store or Google Play. Then, follow these instructions to set up your account:

  1. Open the app and sign in with your Facebook or Google account.
  2. Enter your full name, confirm your email and enter a phone number to get a text verification.
  3. Take a picture of the front and back of your government-issued photo ID.
  4. Enter your full address, date of birth and Social Security number.
  5. Read over the terms of service and wait for Synapse Fi, SoLo Funds’ partner, to verify your information.

From here, you can connect your debit card and bank account to the app and begin borrowing — or funding — small loans.

More about SoLo Funds

SoLo Funds first launched back in 2018 with a mission to create a platform for “affordable loans powered by the people.” It’s designed to help individuals lend and borrow without having to go through banks or face high fees from short-term lenders.

Should I use SoLo Funds?

SoLo Funds is a different kind of short-term loan alternative. It takes peer-to-peer lending and distills it into smaller amounts to help people who just need a little extra cash to get by.

But with limited protections in place for lenders and poor borrower reviews, you may want to consider other payday loan alternatives first. Or read our guide to short-term lending to learn more about how it all works.

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