Merchant Cash and Capital – a leading provider of short term SME credit in the States – has changed tack, placing a firmer emphasis on technology.
The company has now rebranded as Bizfi. Merchant Cash and Capital was a business loan brokerage of sorts, sourcing financing options from a range of lenders for SME customers. Merchant Cash and Capital launched in 2005, and has facilitated upwards of $1.3bn in small business loans to date. The Bizfi rebrand reflects the company’s transition into a technology-led resource, which appears to deliver a similar service, but in a more intuitive, online fashion.
The major changes include the use of a front-end application interface, and a back-end solution which entails the aggregating of multiple funding products from numerous lenders. These lenders include the likes of OnDeck, Funding Circle and Kabbage. There are perhaps as many as 35 funders plugged into the Bizfi site. Quality Bizfi applicants will likely field multiple funding offers, which should serve to drive down their cost of finance.
The rebrand also includes white labeling and API facilities. Various online SME facing solutions may now integrate the Bizfi funding interface into their own offering – allowing them to afford their clients access to a deep pool of potential liquidity. The target market for this API solution will be companies that already service the SME community, such as accountancy and consultancy firms. Marketplace lending platforms may also use the white label as a branded solution for marketing their own products to SMEs.
Stephen Sheinbaum, Founder of Bizfi, explained:
“Companies that already serve the small business community are looking for ways to deepen their relationships with current customers. The Bizfi API and white label solutions will empower these service providers to offer a suite of financial services which will further cement the bond.”
Bizfi is by no means the only aggregator of small business funding solutions to have graced the States. Lendio delivers a not dissimilar service, and is partnered with the major office supply chain Staples. The Business Backer is in roughly the same referrals field, but with some balance sheet lending capacity of its own. Cloud Lending Solutions’ CL Originate is also playing in this space.
And yet we've still not seen any sign of a government-backed referrals system appearing in the US market, akin to the one that is slowly coming together in the UK. The British Business Bank recently shortlisted over 10 platforms, all of which remain in the running for designation as a mandatory point of referral for business loans that are rejected by the bank. The next phase in the process is the “Request for Proposal”, which will likely cut down the number of prospective solutions significantly.
With so many aggregation-based business funding solutions springing up in the States, might we see a referral scheme of sorts emerging? It's a point that we suspect may have been raised in at least one of the many responses to the US Treasury's recently issued "Request for Information".