Q1 Update: Here are Five Partnership Deals Lenders Struck
It’s the end of Q1 and it’s time for that scorecard and see what lenders were up to. The year has been favorable for marketplace and online lenders so far. The Fed kept rates unchanged, small business borrowing peaked in February and many of these companies made impressive hires. As companies prepare for the second quarter, here are some of the key partnerships made by online lenders so far this year.
The year started with a bang for alt lending posterboy OnDeck Capital with a referral arrangement with California-based Opus Bank. OnDeck will finance Opus’ small business clients requiring up to $500,000 through lines of credit, flexible term loans and quicker processing.
Home improvement loans have been a cash cow for San Francisco-based Prosper Loans. Last month, (March 14th), marketplace HomeAdvisor entered into an exclusive multi-year contract with Prosper to provide home improvement loans after the company quietly terminated a similar contract with Lending Club.
As of 2014, approximately 8 percent of Prosper borrowers said their loan was for home improvement. Orchard, in its analysis states that these loans may in part be a substitute for traditional home equity lines of credit, which used to be easier to obtain prior to the housing crash.
Bizfi-West Coast Banking Group,
Small business lender Bizfi struck a deal with Western Independent Bankers, a trade association of community banks in the west coast to be the exclusive alternative finance lender for small businesses that are members of the association.
The New York-based alternative lender also signed on the New York State Restaurant Association to provide equipment financing, invoice financing and lines of credit for 2,000 restaurants that are members.
Consumer lending company loandepot and marketplace lender Avant launched a borrower referral program. Under the mutual borrower program, the two companies will have access to each other’s customer base to “expand credit options to responsible borrowers.”
Atlanta-based Kabbage landed itself a sweet deal with the National Federation of Independent Business, throwing open a potential market of 325,000 small businesses where members can access lines of credit of up to $100,000 and flexible term loans.
Kabbage also debuted in the UK with Santander Bank which will use Kabbage’s technology to underwrite quick loans up to 100,000 pounds the same day for loans that typically take 2-12 weeks to process.
Last modified: April 6, 2016