Sounds like a payday loan
> If the factoring transfers the receivable "without recourse", the factor (purchaser of the receivable) must bear the loss if the account debtor does not pay the invoice amount.[1] If the factoring transfers the receivable "with recourse", the factor has the right to collect the unpaid invoice amount from the transferor (seller).
Even in a scenario where the transfer specified "with recourse" there is no guarantee that the seller will still be solvent so there is a risk to the purchaser.
Looks like Pipe offers a trading platform to bid and buy something kind of like a collateralized 'bond' (future monthly income).
I would assume you could bring the 'spread' down and thus the pay day borrower gets a lower interest rate (is spread the right word?)
Given the huge profit of predatory lenders there is room to lower rates.
Definitely big challenge that might not work is how to assign a risk rating to a single human with no banking/credit history. Maybe another idea could use ML & more consumer data to create fairer & more predictive credit ratings.
Debt = risk.