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LendSaaS Partners with Actum Processing to Pioneer Real-Time Payments in MCA Sector

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In an industry-first initiative, LendSaaS, the premier Merchant Cash Advance (MCA) origination and servicing platform, is thrilled to announce its integrated partnership with Actum Processing, a leader in ACH and real-time payment processing.

Innovative Integration for Instant Merchant Funding
LendSaaS has integrated Actum’s cutting-edge RTP technology, positioning itself as the first platform in the MCA space to offer instant funding solutions to lenders. This transformative feature enables MCA lenders on the LendSaaS platform to instantly transfer funds to their merchants 24/7/365, streamlining the funding process and significantly reducing the transaction costs associated with traditional wire transfers.

Revolutionizing MCA Funding
With the integration of Actum’s RTP capabilities, LendSaaS is setting a new standard in the MCA industry. Lenders can now enjoy the dual benefits of immediate fund disbursement and cost savings, providing their merchants with unparalleled financial support and operational efficiency.

Commitment to Excellence
Both LendSaaS and Actum are committed to leveraging technology to enhance the lending experience. This partnership reflects their dedication to innovation, security, and customer satisfaction, ensuring that MCA lenders and their clients receive the best service possible.

About LendSaaS
LendSaaS is a leading software solution in the MCA industry, known for its comprehensive suite of tools designed to streamline and optimize the lending process. From origination to servicing, LendSaaS provides lenders with the technology they need to succeed in a competitive market.

About Actum
Actum is at the forefront of payment processing solutions, offering secure and efficient ACH and RTP services. With a focus on innovation and reliability, Actum empowers businesses across various sectors to maximize their payment strategies.

Contact LendSaaS and Actum processing to learn more about this partnership and the benefits of real-time payments in the MCA sector.

LendSaaS / sales@lendsaas.com / (888) 369-5376
Actum Processing / sales@actumprocessing.com / (800) 975-5640

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The CFPB Now Wants to Work With Loan Marketplaces?

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comparisonThings are getting weird in government land. The CFPB, the regulator in charge of collecting data from small business finance companies starting this Fall, has just revealed what one of its long term goals of that might be, incorporating the data into loan marketplaces.

That’s because on Wednesday, CFPB Director Rohit Chopra said that he plans to do exactly that with another industry the agency collects data on, the credit card industry.

…reliable information about interest rates is also just hard to come by. So, we instead see people comparing cards by annual fee, or rewards, or perhaps just signing up for a card from the same bank where they have a checking account, assuming the interest rate they’re charged will be competitive. To help make this process easier, we are assembling a pricing data set for third-party comparison websites and others to use to help consumers find the best deal for them. This will rely on data submitted under existing requirements of the 1988 law. I hope to share more about those plans in the coming months.

While it may be a leap at this stage to say that this will happen in the small business finance industry any time soon, virtually none of the speculation surrounding what the CFPB will actually do with the data it collects, if anything at all, has been that it would be integrated into loan marketplaces for merchants to compare options. Given current trends across all levels of government this is not so preposterous. For example, the City of New York just introduced its own business loan marketplace and the SBA just upgraded theirs. Couple this with a slew of recent regulatory enforcement activity in the private sector and the idea that there is a plan for government-run business loan marketplaces that are powered by federal agency loan data for comparison shopping is not incomprehensible.

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On Long Island? You Might See Signs

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broker fair 2024

Billboards for Broker Fair 2024 have gone up across several Long Island towns this past week, including locations in Glen Cove, Syosset, Westbury, Bay Shore, and Valley Stream. The conference, built specifically around a broad range of commercial finance brokers, will take place on May 20 in New York City. Long Island is among the largest geographical employers of brokers in the United States.

Broker Fair attendees can expect to learn from industry pro Peter Ribeiro, meet a wide range of funders/lenders & vendors, pitch their deals, and find out what they need to be doing to remain compliant and become successful.

Broker Fair 2024 will take place at the Metropolitan Pavilion in New York City. Brokers pay the lowest price for entry. There is also a pre-show party the night before on May 19th at a Lounge called Somewhere Nowhere NYC (yes that’s really the name!).

If you’re a broker, Broker Fair 2024 is an event you cannot miss!

REGISTER HERE

bay shore long island

A Broker Fair billboard in Bay Shore, Long Island

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Controversial Search Engine Marketing Tactic Targeted by Google

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Google DarkWhen company domain names expire, some investors snatch them up to take advantage of the residual benefits left behind. That is that if the company had a significant footprint in search engines before going out of business then it can pay big money to bring that domain name back to life and monetize its organic search traffic.

But Google hasn’t become too fond of this strategy since it’s apparently often used in a deceptive manner.

“Expired domain abuse is where an expired domain name is purchased and repurposed primarily to manipulate search rankings by hosting content that provides little to no value to users,” wrote Google as part of its new policy. “Expired domain abuse isn’t something people accidentally do. It’s a practice employed by people who hope to rank well in Search with low-value content by using the past reputation of a domain name. These domains are generally not intended for visitors to find them in any other way but through search engines. It’s fine to use an old domain name for a new, original site that’s designed to serve people first.”

Google also made changes to its core algorithm that is reducing “unhelpful, low-quality, unoriginal content in its search results by 40%.”

Once upon a time Google organic search traffic could be make or break for a company but today there are so many platforms that people are using (Think the Amazon Echo, ChatGPT, TikTok, and more) that it is merely one channel out of many on the internet to acquire customers.

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New York State Bill Aims to Recharacterize Factoring, Leasing, Revenue Based Financing, and More

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Albany, NY - Capitol BuildingA proposal to amend a New York State statute that governs how the rate of interest is computed “upon a loan or forbearance of any money, goods, or thing in action” seeks to broaden its application to an all encompassing umbrella of loan and non-loan products defined as a “financing arrangement” and then subject them all to usury caps.

And yes, it applies to commercial financing.

According to Assembly Bill 9585, a financing arrangement will be defined as “to include loans, forbearance of any money, goods or things in action, and all other transactions that involve the lending or advancing of money, goods or things in action for an amount charged, taken or received, and all transactions that operate as substitutes for such products, including but not limited to retail installment contracts, merchant cash advances, invoice financing, revenue-based financing, earned wage access or similar wage advance transactions, lease- or rent-to-own arrangements, rental-purchase agreements as defined in subdivision six of section five hundred of the personal property law, buy-now pay-later transactions, financing for litigation or legal settlements, income-sharing agreements and financing for education.”

And once that rate of interest is computed, “any rate exceeding twenty-five per centum per annum” in accordance with how the rate is allowed to be calculated, will be considered a Class E Felony of Criminal Usury.

This is just a bill. It hasn’t passed anything yet. It can be read here. It was introduced by Assemblywoman Helene E. Weinstein.

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Bill Introduced to Try and Block SBA’s Plans to Become a Direct Lender

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white houseIn case you missed it, the White House has called for the SBA to get into the direct lending business to “address gaps in access to small dollar lending.” The SBA has previously defined “small dollar lending” as loans under $150,000. Now the Biden administration wants it to compete in this segment against the private sector.

But a new bill introduced by two republican senators, called the Protecting Access to Credit for Small Businesses Act, says not so fast.

It literally says that its purpose is to “To prohibit the Administrator of the Small Business Administration from directly making loans under the 7(a) loan program, and for other purposes.”

“Fraud and inefficiency characterize the Small Business Administration’s history in direct lending,” said Senator John Kennedy in a statement. “The government shouldn’t crowd out private lenders that are already doing a good job getting funds to the small businesses that need them. I’m proud to partner with Sen. [Tim] Scott to stop the SBA from replacing private lenders and those in our communities with Washington bureaucrats.”

“When acting as a direct lender, the SBA has a consistent history of failure and inefficiency when compared to the private sector,” said Senator Scott. “The administration’s proposal is just a vehicle for a big government overreach into nearly all aspects of American life and private institutions. There’s simply no reason to use the federal government to funnel tax dollars that will later be loaned back to small businesses.”

Government agencies at all levels seem to be creeping into the small business lending game. Not only has the SBA recently upgraded its Lender Match online loan marketplace but the City of New York also recently launched its own business loan marketplace.

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NYC Promotes its Own Online Business Loan Marketplace

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New York CityThere was so much demand for NYC’s experimental Small Business Opportunity Fund last year that it had to stop accepting applications after just 3 weeks. The program, however, ultimately enabled 1,046 businesses to collectively borrow $85 million at a low interest rate of only 4%. While the Mayor’s office has declared it a major success it is now encouraging anyone else seeking funds to use its relatively new online business loan marketplace called NYC Funds Finder.

Facilitated by Next Street, a b2b platform whose co-CEO Michael Roth is a former interim chief of the SBA, NYC Funds Finder promises to connect business owners with capital products that are “non-predatory and have been screened to ensure fair and transparent pricing and terms.”

An example of some of the lenders on the platform include Lendistry, Accompany Capital, and SmartBiz. APRs tend to range roughly from 7% to 19%.

“NYC Funds Finder serves New York City’s small businesses by aggregating funding options from many of [the NYC Department of] Small Business Services (SBS) and Next Street’s trusted partners,” said an official announcement that went out in September. “Additionally, the platform makes it easy for the business owner to connect with a free advisor if they need help navigating or applying for capital. This partnership with trusted SBS advisors is key for small businesses to access the best financing options for their business.”

Coincidentally, the SBA has also been pushing its own online business loan marketplace as of late. The SBA’s Lender Match tool has 1,000 SBA lenders and 257 community based lenders on its platform already.

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What Big Publicly Traded Companies Say About Merchant Cash Advances

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deBanked examined the public messaging from some of the largest publicly traded merchant cash advance facilitators in the US and this is what it found:

SHOPIFY

A merchant cash advance is a purchase of your future sales, also known as receivables. If your application for funding is accepted, then Shopify provides you a lump sum of money for a fixed fee. Under the Shopify capital agreement, this lump sum is known as the amount advanced, and the total to remit is the amount advanced plus the fixed fee. In return, you pay Shopify Capital a percentage of your daily sales until Shopify receives the total to remit. The percentage of your daily sales that you must remit to Shopify is known as the remittance rate. The amount advanced and the remittance rate depend on your risk profile.

For example, Shopify Capital might advance you 5,000 USD for 5,650 USD paid from your store’s future sales, with a remittance rate of 10%. The 5,000 USD amount that you receive is transferred to your business bank account specified in your admin, and Shopify Capital receives 10% of your store’s gross daily sales until the full 5,650 USD total to remit has been remitted. You have the option, at any time, to remit any outstanding balance in a single lump sum.

There is no deadline for remitting the total to Shopify Capital. The daily remittance amount in USD is determined by your store’s daily sales, because the remittance rate is a percentage of your store’s daily sales. The remittance amount is automatically debited from your business bank account.


DOORDASH

DoorDash Capital is a cash advance, not a loan. With a cash advance, the offer is based on your sales and account history, and includes a simple, transparent one-time fee that you’ll know before you decide to accept the offer. A loan operates using interest, which can compound over time, and often includes other fees in addition to the stated interest rate.

doordash capital


LIGHTSPEED

lightspeed


AMAZON

A [merchant cash advance is a] non-revolving sum of funding with flexible payment, no personal collateral required and no late fees. With flexible payment, no personal collateral required and no late fees, a merchant cash advance provides sellers funding to help run and grow their business. Unlike interest-bearing loans, the advance ties payment to a portion of a seller’s future sales for a fixed capital fee, there are no additional fees or interest charged.


NERDWALLET

Fixed withdrawals from a bank account
Merchant cash advance companies can also withdraw funds directly from your business bank account. In this case, fixed repayments are made daily or weekly from your account regardless of how much you earn in sales, and the fixed repayment amount is determined based on an estimate of your monthly revenue.


PAYPAL

A merchant cash advance is not a loan, but rather a type of financing that business owners pay back with a percentage of their future sales.


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