Collectively, Americans owe more than $1 trillion in credit card debt. The average household with credit card debt owes $16,883.

Carrying a balance can be costly in the long-run: Thanks to exorbitant interest rates — the average APR is close to 17 percent — you could end up owing thousands of dollars in interest if you don't pay off your card in full.

One San-Francisco start-up, Tally, wants to make your interest rate lower and your credit cards cheaper. Here's how the app works: If you get approved for a "Tally credit line" — you need to have at least a 660 FICO credit score to qualify — Tally will pay off your high-interest cards and then charge you a lower interest rate on the same balance. Your new rate is determined after Tally looks at your credit history.

It's like getting a personal loan, but from an app. After adding your credit cards to the app, Tally runs a credit score check to see if you're eligible for a Tally credit line. Here's what the interface looks like:

By borrowing money from banks in bulk, Tally can "pass savings on to our users that wouldn't typically be available to them," says CEO Jason Brown. He co-founded the company with Jasper Platz in 2015 and together, the entrepreneurs have raised $42 million in funding.

The app is free to download and makes money like a typical credit card company does: by charging interest. But that amount is guaranteed to be less than what you would pay your credit card, so Tally only makes money if it saves you money with a lower APR. Tally also automatically sends payments for you, meaning you'll never have to worry about late fees. That's the benefit for consumers who don't carry a credit card balance: If you have trouble keeping track of several credit cards and find yourself paying late fees, Tally will manage them for you by automatically paying your bills.

The goal is to separate the burden of credit cards from the benefits, says Brown: Consumers still get the rewards that come with using credit cards, but they don't have to worry about payments, late fees and penalties.

Since officially bringing the app to the public in October 2017, "we've already saved millions of dollars for customers," Brown tells CNBC Make It. And he hopes the latest feature, Tally Advisor, will help debt-ridden consumers even more.