Credit Card Startup Plastc Shuts Down, Thousands Lose Out

plastc

In 2014, startup Plastc announced its plans to launch its all-in-one credit card. Thousands of people placed a pre-order to get access once the card launched.

But on April 20, 2017, Plastc announced that the company was shutting down operations and would not fulfill the orders that customers placed, leaving them in a bind.

Find out why the business is shutting down and what consumers can do to recoup their losses.

What is Plastc?

Plastc was a startup that set out to create an all-in-one smart card. The card would combine all of your debit and credit cards in one place. Instead of carrying around a wallet full of different credit cards, you would just need the Plastc card.

The idea was hugely appealing to consumers. Companies like Plastc billed a smart card as a more secure option than traditional cards because there would be no visible account number on the physical card.  The card would also be password-protected, preventing thieves from stealing your information or making fraudulent purchases.

Because of those benefits, many people were willing to part with their hard-earned money to bring Plastc to life. Over 80,000 people pre-ordered a Plastc card, raising over $9 million for the company.

Plastc now shutting down operations

Despite its popularity, Plastc announced a sudden decision to close the company and let go all of its staff.

In a message on its site, Plastc said the closure was due to a lack of investor funding.

After making enormous leaps in development, product innovation and progress towards our goal, Plastc has exhausted all of its options to raise the money it needs to continue. Plastc, Inc. is exploring options to file Chapter 7 Bankruptcy and will cease operations on April 20, 2017.

Thousands of people who spent their money to pre-order the Plastc card now face a financial loss. Since the company is filing for bankruptcy, customers will not get any refund.

What Plastc customers can do

Many customers have taken to social media to vent their frustration and get some answers about their money. But because Plastc’s staff is gone and their social media accounts are shut down, consumers are unlike to get answers.

smart card

A class action lawsuit is possible, which would help customers get their money back. But such lawsuits can sometimes take months or even years — and you still might not get a refund.

However, there may be other options. If you paid for your pre-order with either a credit card or PayPal, you might be able to dispute the charges and get the money back that way. Because you placed the order with the idea that you would get the card someday, the fact that you didn’t get it could entitle you to a refund through your payment method.

Plastc smart card alternatives

Plastc was not the only company trying to come up with an all-in-one card. While there are several that are adding customers to a waitlist, few have the technology perfected enough to launch.

One of the few options out there is Wocket. For $179, you can get a card that syncs all of your credit cards, debit cards, gift cards, and loyalty or membership cards.

The dangers of early pre-orders

While some people may be able to recoup at least some of their money, many others will not. That’s a big danger with startups accepting pre-orders for a product they haven’t successfully created yet and for crowdfunding an idea.

Before placing an order or investing your money in a great idea, make sure the amount is money you can comfortably lose. If you need that money to pay bills or pay down debt, investing in a startup is probably too dangerous a gamble for you to take.

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SoFi Disclosures

  1. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (www.nmlsconsumeraccess.org)
  2. Personal Loans: Fixed rates from 5.49% APR to 14.24% APR (with AutoPay). Variable rates from 5.29% APR to 11.44% APR (with AutoPay). SoFi rate ranges are current as of December 1, 2017 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 5.29% APR assumes current 1-month LIBOR rate of 1.34% plus 4.20% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

Citizens Bank Disclosures

  1. Personal Loan Rate Disclosure: Variable rate, based on the one-month London Interbank Offered Rate (“LIBOR”) published in The Wall Street Journal on the twenty-fifth day, or the next business day, of the preceding calendar month. As of August 1, 2017, the one-month LIBOR rate is 1.23%. Variable interest rates range from 6.02% – 15.97% (6.02% – 15.97% APR) and will fluctuate over the term of your loan with changes in the LIBOR rate, and will vary based on applicable terms and presence of a co-applicant. Fixed interest rates range from 5.99% – 16.24% (5.99% – 16.24% APR) based on applicable terms and presence of a co-applicant. Lowest rates shown are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with Citizens Bank at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, Citizens Bank checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Benefit: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their student loans owned by Citizens Bank, N.A. during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. Discount is not available when payments are not due, such as during forbearance. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account three or more times within any 12-month period, the borrower will no longer be eligible for this discount.
7.39% - 29.99%$1,000 - $50,000Visit Upstart
5.29% - 14.24%1$5,000 - $100,000Visit SoFi
8.00% - 25.00%$5,000 - $35,000Visit Payoff
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