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By Lydia Beyoud
- OnDeck joins ranks of fintechs approved for SBA emergency loan program
- More online small business lenders in queue to join banks, credit unions in $349 billion loan program
(Bloomberg Law) —
Fintech lender OnDeck, Inc. is joining forces with Utah-based Celtic Bank to provide small business relief loans through the Paycheck Protection Program.
The partnership pairs one of the largest online small business lenders in the U.S. with one of the leading banks in the Small Business Administration’s 7(a) loan program, OnDeck said in a statement Monday. The New York-based online lender has also applied to the SBA to offer the federally-guaranteed loans directly.
A spokesman for the company said OnDeck expects a decision soon on its application.
“We plan to carefully scale our application intake to ensure an outstanding customer experience and avoid excessive wait times between approval and funding,” OnDeck Chairman and Chief Executive Officer Noah Breslow said in the statement.
With the announcement OnDeck joins other fintech lenders, including PayPal Inc., Intuit Inc., and Square Inc. in offering the federally-guaranteed loans.
Fintech small business lenders often provide financing that many banks and credit unions don’t find profitable, typically in small amounts and to startup companies.
Other fintech lenders like Kabbage Inc. and Funding Circle, Inc. are also seeking to join the $349 billion program.
Congress created the temporary program in March to provide assistance to small businesses that have closed or faced other economic hardships due to the coronavirus pandemic. Some of the federal loans can be eventually converted into grants, if companies use them to support employee payroll and other approved expenses.
Congress is already under pressure to expand the program as small businesses fear being unable to access loans before the funds run out.
To contact the reporter on this story: Lydia Beyoud in Washington at email@example.com