Articles by deBanked Staff
Florida Set to Enact Commercial Financing Disclosure Law With Unique Broker Rule
May 15, 2023Update: the governor signed the bill into law on June 23.
It’s a new state disclosure law but with a twist. Florida’s bill, which passed both chambers of the legislature on May 4th and now awaits the governor’s signature, has a specific code of conduct aimed directly at brokers.
Among these rules is that the broker cannot:
- Offer its services in any advertisement without disclosing the actual address and telephone number of the business of the broker and the address and telephone number of any forwarding service the broker may use, if any.
- Make or use any false or misleading representation or omit any material fact in the offer or sale of the services of a broker or engage, directly or indirectly, in any act that operates or would operate as fraud or deception upon any person in connection with the offer or sale of the services of a broker, notwithstanding the absence of reliance by the business.
- Make or use any false or deceptive representation in its business dealings.
- Assess, collect, or solicit an advance fee from a business to provide services as a broker. However, this subsection does not preclude a broker from soliciting a business to pay for, or preclude a business from paying for, actual services necessary to apply for a commercial financing transaction, including, but not limited to, a credit check or an appraisal of security, if such payment is made by check or money order payable to a party independent of the broker.
The bill, as written, says it is poised to go into effect on July 1, 2023 (assuming the governor signs it). deBanked first reported on this bill on March 16th.
Small Businesses Felt the Shift in Q1 as Well
May 10, 2023At the end of last year, small businesses were feeling a renewed sense of optimism about what 2023 might bring. Then the mood soured a little, according to a new study conducted by IOU Financial. “Most businesses did not perform as well during the first quarter of 2023 as they had the previous quarter,” it found. Only 28% of respondents said that their business performed in line with their expectations for the quarter and thirty-seven percent said that their business actually performed worse or much worse. Despite this, only 12% predict that their business will perform worse or much worse in Q2 vs. Q1. In fact, 67% predict that their business will perform somewhat better or much better than Q1.
Interest rates and a possible recession remain the top concerns for business owners. Overall, IOU summed up its findings as a “rocky start to 2023, but optimism for small business growth remains strong.”
Georgia Governor Signs Commercial Financing Disclosure Law
May 9, 2023Georgia’s governor signed the state’s commercial financing disclosure bill into law as anticipated. The full text is available here. It is scheduled to go into effect on January 1, 2024. Georgia’s new law is merely the latest in a series aimed at the small business and commercial financing industries.
Others include:
- Virginia’s sales-based financing disclosure law – Went into effect July 1, 2022
- California’s commercial financing disclosures – Went into effect December 9, 2022.
- Utah’s commercial financing disclosures – Went into effect January 1, 2023.
- New York’s commercial financing disclosure law – Goes into effect August 1, 2023
- CFPB’s small business lending data collection law – Goes into effect October 1, 2024
Welcome to Broker Fair 2023
May 8, 2023
Broker Fair check-in and breakfast start at 8am at the Hilton Midtown in NYC.
If you’re here today, here’s some quick helpful info:
WIFI PW: ROKFinancial
Contact info: events@debanked.com
We hope you enjoy the day!
Broker Fair’s Pre-Show is Tonight From 7-9pm at The Valerie
May 7, 2023
Broker Fair’s Official Pre-Show Party takes place tonight at 7-9pm at The Valerie in NYC. Officially sponsored by Bitty Advance, the venue is at 45 W. 45th St. The Entrance is on W. 45th. This event is only open to those who purchased a ticket in advance.
Broker Fair 2023, which takes place tomorrow on May 8th is at the Hilton Midtown.
See you there!
Shopify Capital’s Funding Volume Continues to Surge
May 6, 2023Shopify’s business lending and merchant cash advance division originated a whopping $477M in the first quarter of 2023. That’s up substantially from the $346.7M produced in the first quarter last year. Despite the continuous strong increase, Shopify Capital was not mentioned or even asked about during the company’s quarterly earnings call.
Shopify is a huge e-commerce business. The company generated $1.5B in revenue in Q1 and generated a net income of $68M.
Square Loans Originates $1.1B in Funding in Q1
May 5, 2023
Block is not slowing down its small business lending division. Square Loans originated $1.1B across 113,000 loans in the first quarter of 2023, keeping it on pace to continue remaining the largest small business lender that deBanked publishes data on. The company said that loss rates remained consistent with historical ranges and that strong revenue and gross profit were achieved.
Amazon’s Seller Lending Program Receivables Cool Off
April 30, 2023
According to documents purportedly obtained by Business Insider in January, Amazon had planned to increase its business loan operations in 2023, estimating that its loan receivables would eventually exceed $2B. Instead, the receivables figure has been slowly going in reverse, according to an examination of the company’s regular quarterly earnings reports. Amazon’s seller lending receivables hit a high of $1.4B in Q3 of 2022 but then ticked downward to $1.3B by year end. In Q1 of this year, those receivables had gone down again to $1.2B.
Amazon’s Seller Lending Receivables
2016: $661M
2017: $692M
2018: $710M
2019: $863M
2020: $381M (covid)
2021: $1B
2022 (Q1): $1.1B
2022 (Q2): $1.3B
2022 (Q3): $1.4B
2022 (Q4): $1.3B
2023 (Q1): $1.2B
Not counted in these figures is financing to Amazon sellers conducted through a third party. Amazon teamed up with Parafin on merchant cash advances, Lendistry for Business Loans, and Marcus for lines of credit, for example. Data on funding from these parties is a little more difficult to come by.
