Here’s why so many fintech startups are loaning to small businesses
Everyone wants to lend to small businesses, as the rise of financial technology continues to bring constituent actors closer in terms of characteristics. Thinking in general terms, the growing focus on small business loans among fintech B2B and finservices companies feels directionally similar to the increase in consumer-oriented fintech startups that added banking features last year.
This week, several stories underscored the growing appetite for small business loans, including news that Goldman Sachs is "close to an agreement with Amazon to offer loans to e-commerce giant merchants," according to CNBC. Amazon has a lot of data about its business partners and Goldman has a lot of money; By combining their powers, they can probably earn some money by lending capital.
However, Goldman's news is nothing but a fun game. What matters to us are the new companies that work to lend money to other concerns. This week, Divvy announced an orderly program that brings it into space, while Kabbage, a company backed by Vision Fund, made its small business loans even more flexible.