Earnest is a startup trying to change the conventional thinking about personal loans for whatever your needs may be whether to move, buy a wedding ring, or pay off high-interest-rate student loans.

Bank Innovation spoke to co-founder and CEO Louis Beryl about the company’s origins, the concept of merit-based loans, and future plans for the company.

What data would we want to look at? Earnest is similar to how banking was done before credit 50 years ago, when lenders got to know borrowers on personal level. We got away from that over the past few decades.”

There were two reasons people have come to Earnest: either they couldn’t get a loan elsewhere or they were being overcharged, which is a major issue for many young borrowers.

Earnest focuses on offering fair rates for people who are being overcharged by their loan providers based on their weak credit history, student loans, and other factors even though they’re fully employed and actually quite reliable.

What separates Earnest from competitors like Lending Club and Prosper is that Earnest doesn’t charge any fees and offers a flat APR for customers, depending on the length of their loans.

Earnest is currently content to stick to merit-based personal loans, but the company has plans to expand in the future toNot just unsecured small loans, but mortgages, student loans, car loans, etc. But it all depends on the demands of our clients once they demand them, we’ll start expanding.” However, the May round of funding will be used on expanding the service geographically, not by asset class.