SBA lending efforts may soon expand to include fintechs - Phoenix Business Journal

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SBA may open its lending doors to nonbanks. Here's when that could happen — and what it means.

recently released research using Funding Circle data that showed that fintech lending platforms’ use of alternate data, such as internal credit scores, meant those companies reached business owners who normally wouldn’t be able to work with a traditional lender.

“Overall, fintech lenders have a potential to create a more inclusive financial system, allowing small businesses that were less likely to receive credit through traditional lenders to access credit and to do so at lower cost,” the report said. According to lawmakers and supporters of rescinding the rule, the average good faith error with the program is more than $12,000 — a significant amount for many small businesses.

 

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