SME smartphone lending set to take off

THE VOLUME of smartphone-based lending to small- and medium-sized enterprises (SMEs) will grow exponentially this year, according to new research from the US.

Fintech platform Kabbage predicts that 20 per cent of US dollars lent to SMEs will be via smartphone apps by the end of 2018.

Kabbage analysed nearly 150,000 US small businesses and found an increasing trend towards lending organised via mobile devices, with the number of loans increasing more than 300 per cent.

“The growth of mobile lending is evidence of an enormous change occurring in this industry,” said Kabbage’s chief revenue officer Victoria Treyger.

“Small business owners are increasingly digitally savvy and are adopting new technologies faster than ever before.

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“Lending is no different. Kabbage is pioneering this shift in lending by making it a priority to meet small business owners where they are and integrate seamlessly into how they’re already running their businesses.”

The firm says the growth demonstrates a new trend as small business owners expect a simple application process, with little delay before a decision is made before they can access working capital.

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Kabbage enables small businesses to apply, qualify and withdraw funds through a mobile app, which is available for Apple and Android devices.

All its US-based loans are issued by Celtic Bank and this year it increased the line of credit offered to SMEs to $250,000 (£186,500).

Kabbage has several partnerships with global banks for an online lending platform, powering small business lending for ING, Santander and Scotia Bank across Canada, Mexico, Spain, the UK, Italy and France.

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