According to the FTC lawsuit, Brigit said that paying members could get "instant" cash advances of up to $250 and that it would not charge late fees or interest on advances that were still due.
Brigit App Settles with FTC: The app for managing your money The Federal Trade Commission said Brigit has agreed to pay $18 million to settle claims that it misled customers by offering free cash advances and locking them into $9.99-a-month memberships that were hard to quit.
According to the FTC lawsuit, Brigit said that paying members could get “instant” cash advances of up to $250 and that it would not charge late fees or interest on advances that were still due. A lot of people who lived paycheck to paycheck didn’t qualify for these advances, though, and they cost 99 cents to finish. It took up to three work days for people who didn’t pay the fee to get their money back.
The company, which is also known as Bridge It, Inc., decided to stop misleading marketing and tricks that made it hard for customers to cancel their monthly memberships, the regulator said in a statement Thursday.
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In a response, Brigit denied the claims. “The FTC’s claims are not based on facts, they don’t understand our business, and they go against everything we have worked so hard to build for our customers.” No matter what, we’ve chosen to settle this case with the FTC because putting it behind us will be best for our customers and employees.
Brigit’s website says that it has more than 4 million users and provides many services, such as building credit, protecting against identity theft, and keeping track of spending. It’s one of many personal banking apps that let you get cash quickly.
The FTC’s move comes at a time when inflation is making things hard for a lot of Americans. Costs of living and fuel were the main reasons why consumer prices went up 3.7% in September. Also, people have a lot of credit card debt—more than $1 trillion in the second quarter of 2023.
Because of this, a lot of people are getting payday loans or other types of cash payments to fix their money problems. A website called Bankrate.com says that about 12 million Americans get cash loans every year.
Before the refund process can start, the court has to agree to the FTC’s suggested settlement order.
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