About lender
KOHO is a fintech company that has elaborated for Canadians modern financial tools to save and smartly spend money, allowing them to earn simultaneously. KOHO’s product line includes a reloadable prepaid credit card with a cashback on every purchase, a full-service account without hidden fees allowing for interest-earning, and a credit-building tool. In addition, it collaborates with many financial institutions, retailers, state bodies, and other entities to make life easier and enhance business processes.
Features
The company was founded in 2014 and is based in Toronto. While it is not a bank, it provides banking services in conjunction with its partners all over Canada, from Tofino to Fogo Islands.
KOHO presents itself as a company caring about its values and creating open, intuitive financial products designed for a better life for its customers and business promotions.
Pros and cons
Pros
KOHO offers full-service accounts free of charge and without hidden fees and no minimum balance required.
There is no account opening, account closing, moving money, or e-Transfer fees.
Automatic identity verification eliminates the necessity to go to the institution personally.
The automated savings are implemented, allowing you to earn about a 1.2% annual interest rate calculated daily and paid off monthly.
A 0.5% cash back is available on all purchases by partner companies and more with a Premium account.
A free trial for a Premium account is available for 30 days.
The option of a joint account is available.
The funds can be received from a client’s debit card added to the KOHO app.
PayPal, Xoom, or Stripe can be connected with KOHO cards.
Utility bill payments can be made via KOHO accounts.
International transfers and payments abroad are available.
Direct deposits of Income Tax Refund, Canada Child Benefit, Goods and Services Tax/Harmonized Sales Tax (GST/HST) Credit, Canada Workers Benefit, and Ontario Trillium Benefit are available from Canada Revenue Agency (CRA).
A separate Virtual Card for online shopping is offered.
Free financial coaching is provided.
All direct deposit cash balances in clients’ accounts are held in trust at a Canada Deposit Insurance Corporation (CDIC) member institution.
A program for building credit history and upgrading credit scores is provided.
There is a referral program allowing you to earn money by inviting friends. A customer may invite up to 50 friends.
KOHO collaborates with many companies in various industries, broadening the list of partners and offers from big businesses to local shops.
The collaboration program is card-linked and gives companies more direct marketing to target consumers and reacher data insights.
There is a 3-month trial period available as a trial period for the partner companies.
Cons
Personal details like the name or address provided to KOHO should coincide with the same data stored in banks, including debit card details. If not, nothing works.
Wire transfers, void checks, mobile check deposits, and ATM cash loads are not accepted as account loading methods.
There are maximum fund limits on cards and accounts in KOHO.
As KOHO is not a bank, accounts at KOHO do not have a Swift Code, International Bank Account Number (IBAN), or a Bank Identifier Code (BIC).
Not all deposits from CRA can be received via KOHO.
Some services require a subscription tariff.
Some websites, such as Trustpilot, have negative reviews about the company's trustworthiness.
There are many advantages to using KOHO services. This fintech looks like a modern financial institution, offering everything online and instruments for smart money management. KOHO does not require customers to come to the office for identity verification, ensuring an online process. It offers convenient cash back with partner companies and calculates a daily percentage of the money in the account, although it pays them monthly. The account itself costs nothing and gives a lot of benefits.
Meanwhile, there are also disadvantages. And the most noticeable of them is poor customer support operations. People complain that some money has disappeared from their accounts and the support team can’t help them. In addition, several reviews mark unauthorized cancellation of the account and the absence of expected cash backs.
Conditions
The company provides loans only within KOHO Credit Building and KOHO Advance programs.
KOHO Credit Building
This is a tool developed for those clients who wish to improve their credit history and credit scores. The program operates via subscription only, costing $7 per month. Subscriptions can be canceled at any time, depending on the repayments made.
Within this subscription, KOHO opens a credit line for quite a modest amount of $225, which can be borrowed at a 0% annual interest rate. The credit line has no non-interest charges; the due payment day starts 30 days following a drawdown and then every 30 days while there is an outstanding balance. KOHO expects that at the payment due date, the borrower will repay the full outstanding balance if it is less than $67.50 or the maximum of either 30% of the outstanding balance or $67.5.
Information about the Credit Line and repayments are available in the monthly statements via the KOHO application. In addition, the repayments data and credit history are submitted to credit bureaus and influence the client’s credit score.
KOHO Advance credit line
This is available for those with a Payroll Direct load. It gives a credit of $100 for all KOHO users and $500 for Canada Life users. This is a no-interest and no-charges program. The customer selects the repayment day at the time of each Advance. The due date and availability of the next Advance depend on whether the customer has subscribed for KOHO Bundle or not. For those with subscriptions, the Advance is available any time, and the due date is 30 days after each Advance. For those without subscriptions, the Advance is available three days before a scheduled Payroll Direct load, and the due date is no later than three days after each Advance. Records of this credit line may be submitted to the credit bureau upon the customer's request.
Information about the Credit Line and repayments are available in the monthly statement via the KOHO application.
The Credit Lines are refilled upon every payment under the same conditions. If the credit line is canceled with all obligations of the borrower fulfilled, it can be reopened later on under the same conditions via the KOHO app. If KOHO enforces the debt payment, future credit lines will be unavailable.
Methods of loan funding
As soon as the KOHO account opens, it is possible to subscribe to the Credit Building Program via the mobile application. The funds are available at the separate, dedicated account precisely the day the subscription fee is paid. The Credit Building instrument works in 6-month cycles and will auto-renew every six months upon the subscription cancellation.
KOHO Advance fund is available upon the setting of Payroll Direct load with at least one payroll of $100 or more loaded in the current or previous calendar month. The funds are also available in a separate, dedicated account.
