Vermont Employer uses Behavioral Economics to Turn Debt into Wealth

Some readers might enjoy this PBS video about a Northern Vermont company that helps people weather financial storms with small loans. Rhino Foods in Burlington found that employees in financial strain were not as good at their jobs and that the small loans improved the company’s bottom line.  Rhino brought in a combination social worker/financial advisor, who helped arrange 17% income advance loans paid back through wage deductions. Once a loan is paid off, the default rule is that the employee continues to pay into a savings account in the same amount as the prior loan repayment deduction. People who had never saved a dime are now building wealth.