Victory Park Capital will be providing a $50 million credit facility to The Credit Junction – an online provider of working capital financing to SMEs.
This facility will allow the platform to provide comprehensive capital solutions to SMEs across the US, and the company has the long term vision of transforming the way SMEs finance their working capital needs.
Tom Welch, a principal at Victory Park Capital, commented:
“Small businesses are a large segment of the marketplace that continues to be underserved by traditional banking institutions. What excites us about partnering with The Credit Junction is the lack of competition and innovative financing alternatives within the SME ABL space along with its unique customer acquisition strategy. We expect to see substantial growth in the platform over the near-term and our facility is ready to support that.”
This is The Credit Junction’s first institutional credit facility and in addition Victory Park has also provided an investment to fund working capital needs in advance of the company’s equity raise, which is expected to take place later this year.
“We are extremely excited to partner with Victory Park at this stage in our company’s lifecycle. We think an opportunity exists to further disrupt small business lending and with VPC’s support, we now have the pieces in place to execute on our business plan.”
Last month Victory Park also agreed a deal with Prosper to buy marketplace loans over the next two years. But nothing was released regarding the financial details of that investment.
Victory Park Capital’s Specialty Lending Investments Fund floated on the LSE in March this year. The issue was fully subscribed at its target issue size of 200 million shares, raising proceeds of £200 million. In its prospectus the company announced which platforms it has existing relationships with and those that it is likely to gain exposure to. These include, Assetz Capital, Avant, Borro, Elevate Credit, Fast Legal Funding, Kreditech, LendUp Global, Funding Circle USA and Funding Circle, OnDeck Capital, Prosper Marketplace, Square and Upstart. The company aims to be fully invested by September.