As rental costs spiral higher, companies like Esusu and Flex now offer services to split monthly rent, aiming to ease cash flow problems for tenants.
Half of renter households spend over one-third of their income on rent, according to Harvard research. Proponents say these products address a real need-one in two Americans has less than $400 in savings.
Consumer advocates push back, calling the fees predatory. A Protect Borrowers report found a $600 loan for 14 days through Flex costs nearly $30, comparable to payday loans.
While Flex claims built-in protections like no late fees, consumer agencies warn that deregulation has gutted federal oversight. Reports also cite technical glitches causing missed payments and even evictions.
Industry leaders like Esusu's co-founder Wemimo Abbey frame the offering as a lifeline for working families. Critics, like attorney Ariel Nelson of the National Consumer Law Center, call it another system failure for the poor.