Fintech Gets In the Game
The Paycheck Protection Program (PPP) funds were exhausted within the first 2 weeks of the program. TOmorrow, April 23rd, 2020, Congress will release another $310Billion for teh SBA to offer to small businesses as a forgivable loan to cover payroll and keep workers in their jobs. In less than two weeks, $349 billion was claimed by around 1.6 million small business owners. Despite the large number, that only makes up about 6% of the American small businesses currently in operation. This means 94% of small business owners, many of whom have applications pending both with traditional banks and with fintech lenders such as Lendio, have been left without funding. Those business owners can now apply through not only their banks but many online lenders who will process SBA PPP loan applications for the second round of funding.
There’s a lot we have learned over the past two weeks as a nation, as an industry, and as business owners. Some of the most anticipated financial partnerships were made up of members of the Fintech industry, including Lendio, Paypal, and Square. Fintechs were hoping to provide a new avenue for business owners seeking cash and could deliver the funds much sooner than traditional banks. Due to the Fintechs’ experience in technology, the application process was more streamlined for businesses with pre-existing accounts.
The sudden lack of funds announced last Thursday left thousands of small businesses wondering whether their loan applications made it in before the funds ran dry. Many others are putting in applications in anticipation of tomorrow's re-funding of the SBA PPP Program. Fintech firms specialize in lending to the smallest of employers, including mom-and-pop shops and local operators, often perceived as too insignificant and risky to borrow from traditional banks. almost all of them are accepting applications in anticipation of the decision by congress to re-fund the SBA.
As the government continues to release new information and increased opportunities for new SBA PPP loans, these companies are sure to lead the pack in application processing and funds distribution. We have included a full list of the approved Fintech loan partners below. Please check back for updates as the situation changes daily.
- Kabbage: Open to all small businesses. Apply here.
- QuickBooks: Applications are expected to open this week for current Intuit payroll customers. Sign up here to be notified as soon as they are available.
- FIS: On its website, the company does not give a specific timeline, but says it's ready to begin lending in a matter of days. Get more information and an automation guide here.
- Funding Circle: On its website, the company says it's awaiting final SBA approval but is allowing any small business to get a head start by submitting application information and documentation now through its portal here.
- PayPal: Open to current PayPal customers. Apply here.
- Square: TBA. More information here.
- Stripe: TBA