You Need to Know About Innovative Finance

By Charles H. Green

A frequent topic of conversation I’ve been sharing with commercial lenders over the past year has been the emergence of private investor-led companies that are competing with banks for small business loans.  Hopefully you’ve read some of the several stories offered here about them, ranging from the broad list of this category:

  • Merchant cash advance companies, such as CAN Capital, who recently crossed over $4 billion in total funding, a billion of which was funded in about 15 months;
  • ALTLEND lending companies, such as OnDeck Capital and IOUCentral, who transact with customers strictly online;
  • Intermediaries, such as Boefly, Lendio and Fundwell, who connect borrowers to select lenders based on pre-determined screening;
  • Peer-to-peer lenders, such as LendingClub, whose volume of facilitated loans recently hit the $5 billion benchmark and have steered into business lending.

Some of these companies represent threats to market share of commercial banks, although what they are taking away today is limited to smaller credits that would mostly be funded by credit cards. That could change in the months ahead.

Some of these companies also represent opportunities for small business lenders to partner with companies with innovative technology, data and market reach.

I remind you about this sector today because there’s a new conference organized to inform interested parties about the innovative funding sector and provide a full range of discussion about what you need to know. It targets bankers and is intended to bring the up to speed about the technology, innovations and new ideas that has diverted about $100 billion of capital financing away from them.

Interested? The event is AltLend: Innovative Finance for Small Business. It’s in Las Vegas, September 23-24, and offers perhaps the most comprehensive opportunity to date to learn about the largest competitor looming on the horizon of commercial lenders.

Read more at Financial Research Associates.

This entry was posted in ABL, AdviceOnLoan, CRE, SBA
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