PayPal Reiterates Tightening of Business Lending Originations

After announcing a sudden pullback on business loans and MCAs in Q3 due to higher than expected charge-offs, PayPal maintained that the belt was still tightened in Q4.

“We have taken a prudent and active approach to managing our overall credit risk, tightening originations within our PayPal business loans portfolio,” said PayPal CFO Jamie Miller on the quarterly earnings call. “We are carrying lower credit receivables after tightening originations last year.”

Tightened originations has led to the company being dethroned as the top online unsecured small business lender. PayPal at the very least held that notable distinction in 2019 and 2020 but they’ve since been overtaken by Square Loans and Enova.