Credit card debt plagues many Americans. The total owed by consumers in 2017 reached $931 billion, according to a survey by Nerd Wallet. Many people swipe their cards too often and then realize they cannot afford the payments, and falling behind can lead to an endless cycle. About 41% percent of Americans admit that unnecessary purchases contribute to their credit card debt, suggesting that a few extra dinners out and online shopping can add up over time. Currently, the average household with credit card debt owes $15,983 and thus pays $904 in interest annually, according to the same study. What most Americans do not realize is that paying off even a small portion of debt each month can make a difference.
The best way to begin alleviating debt is through automation. This is the basis of Digit’s platform. The automated savings app recently launched Digit Pay to help users “pay off credit card debt without thinking about it.” First, Digit users create a credit card debt goal. The platform then analyzes spending and determines how much money the user can afford to contribute to their credit card bill each month. That amount is taken out of the user’s checking account in small and somewhat unnoticeable increments. The app then automatically makes an extra monthly payment to the user’s credit card. Users can add a one-time savings amount or Boost, pause saving, edit their goals or auto-withdraw their savings. Digit promotes the new offering in a Blog post, which informs users that the feature will roll out slowly and allow users to reserve their spots in line.