LendingTree: SMB Lending Cools Slightly

“When the war started in March and gas prices went way up, that was a shock to the system in that month specifically,” said LendingTree CEO Scott Peyree. “Now, on the small business lending side, I would say we are seeing a little bit of both—fewer small merchants looking for loans and smaller loan sizes than normal. On the lender side, credit is still available, but they are typically offering lower loan amounts at higher interest rates.”

Peyree believes this will correct on its own.

“When you have a cautious merchant to begin with, and then they are not getting the exact loan they want and at a higher interest rate, the sense we are getting is they are just not as urgently looking for money right now because of macro geopolitical stuff that is going on,” Peyree said. “I still think this is a short-term thing that will go away. Once consumer sentiment comes back up and, hopefully, things settle down geopolitically, I think we will be right back off to the races.”

Revenue from the small business segment of its business, however, was still up 49% YoY and they’ve brought on more people to help these businesses choose a solution.

“We have selectively added to our SMB concierge team to help more customers find the right financing options, while increasing the speed of application submission, approval, and funding,” the Q1 shareholder letter states.