The term refers to mobile applications offering financial services similar to those provided by Dave, a well-known budgeting and overdraft protection tool. These applications typically focus on short-term lending, early paycheck access, and various money management features designed to help users avoid bank overdraft fees and manage their finances more effectively. A typical example includes platforms that provide small, interest-free cash advances to cover expenses between paychecks.
The emergence of such applications addresses a significant need for accessible and immediate financial assistance, particularly among individuals with limited access to traditional banking services or those living paycheck to paycheck. Their benefit lies in providing a convenient and often cheaper alternative to payday loans or bank overdraft fees. Historically, the need for these services grew as wages stagnated while the cost of living increased, creating a demand for innovative financial solutions.
