How Technology is Transforming Small Business Lending
(In a Good Way!)
In years past, an entrepreneur had to go to a local bank and sit across the table from a loan officer to request funding. That scenario has gone the way of the typewriter.
Although some small business owners do qualify for a loan through their bank, many have found the process frustrating and tedious. Enter FinTech! Financial technology, aka “FinTech”, is an economic industry made up of companies (like SmartBiz) that use technology to make financial services more efficient.
Easy access to affordable capital is a vital component of a robust economy. According to the SBA, small businesses create over 60% of net new private-sector jobs and employ nearly half of America’s workforce. Helping them expand is one of the surest ways to expand the economy.
Here are some ways technology is helping small business owners who are seeking growth.
The small business loan status quo for years and years was “local bank” + “tons of paperwork”. Now you can keep on your PJs and stay home with your laptop to find a lender. Simply Google “small business loans” and you’ll get about 48,800,000 results.
Instead of clicking on that first link when you’re googling small business lenders, use the power of the Internet to your advantage. Move far beyond a lender’s splashy website to find real, unbiased reviews. Sites like Trustpilot can provide valuable information about costs, customer service, functionality and more. Another way to research is to read reputable publications that explore online small business lending. Search established newspapers and magazines as well as specialized consumer publications like Inc., Entrepreneur, TechCrunch and others. Review a lender’s blog, case studies, testimonials and white papers too.
Scan and upload. If you have your documents in order, working with an online lender can be a dream compared to copying stacks of paperwork and hand carrying, mailing or faxing to a bank. Organization is key here. Check the lenders paperwork requirements and have them ready to scan.
Faster Loan Approvals
Technology allows borrowers to submit paperwork online quickly and easily – lenders can crunch the data for fast approval. Some online lenders can approve your loan in just minutes. On the flip side, borrowers can get a “decline” faster as well. However, this is good news. Small business owners don’t need to spend weeks on an application to ultimately get rejected.
Quick approval generally means that small business owners can get funds fast. This is vital for many. One of the top reasons small businesses fail is being unable to access funds when they are needed. Buying equipment, adding inventory and shoring up cash flow are just a few of the reasons funds might be needed in days instead of weeks or months.
The Bottom Line
Speedy and efficient funding is a fantastic solution for many small business owners. However, not all lenders are created equal. Sometimes fast and easy comes at a price. Use technology to your advantage and research the true cost you’ll pay for funds. SmartBiz uses a streamlined platform to approve and fund quickly while offering a great product – an SBA loan. If you’ve heard that qualifying for an SBA loan is tedious, give SmartBiz a try. Check out what real customers say about their SmartBiz experience on TrustPilot. As an added bonus, use the promo code “BLOG” and receive $500 off closing costs. Click here to log in – growth and savings are right around the corner!