TomoCredit Launches AI Plan for Credit Building

TomoCredit's latest AI tool is built on its history of catering to the "credit invisible," a group of roughly 26 million Americans who lack a credit history with national reporting agencies. An additional 19 million have unscorable records due to insufficient or outdated information. This particularly affects Black and Hispanic consumers, as well as those in low-income neighborhoods. The company was founded by Kristy Kim, a South Korean immigrant who personally experienced the challenges of having no U.S. credit history when she was denied an auto loan despite having a six-figure income. This frustration led her to create TomoCredit in 2018 to help students, immigrants, and others in similar situations. Instead of relying on traditional FICO scores, TomoCredit developed a proprietary algorithm called TomoScore. This technology analyzes alternative data, primarily real-time cash flow and banking information, to assess creditworthiness for those without a traditional credit file. The new AI-powered plan provides a 7-step guide to help users responsibly build credit over 30 to 90 days. This includes practical steps like setting up autopay to avoid late payments, paying down balances to lower credit utilization, and creating a small emergency fund. The AI can also scan credit reports for errors and suggest disputes. TomoCredit's core product has been a credit card that functions more like a debit card, with a 7-day automatic payment schedule to prevent users from carrying a balance. This structure, combined with reporting to all three major credit bureaus, is designed to help users build credit quickly and responsibly. The San Francisco-based startup has raised a total of $39 million in funding over four rounds and is backed by investors including Morgan Stanley, Mastercard, and Barclays. TomoCredit has stated that it has helped over 3 million people gain access to credit.