Small business funding platform Biz2Credit announced on Monday its funding affiliate was approved as a lender for the SBA Paycheck Protection Program (PPP) established under the recently-enacted CARES Act. Biz2Credit reported that this makes it one of the few fintechs that has been approved by the SBA as a non-bank lender under the PPP.
As previously reported, The PPP was established by Congress under the CARES Act to stabilize the economy during the COVID-19 pandemic by providing low-interest financing to small businesses and help them keep their employees on payroll. If businesses maintain their pre-COVID staffing levels, these SBA-guaranteed loans can be forgiven. Biz2Credit further revealed it has helped its customers secure PPP loans since the program started last month, and now can do so directly through its funding affiliate.
Biz2Credit further revealed that it estimates around $1.5 billion in demand for PPP loans from its customers, who are concentrated in industries that have been hardest-hit by coronavirus lockdowns, including many minority-owned businesses located in the New York City metropolitan and tri-state area.
Speaking about the approval, Rohit Arora, CEO of Biz2Credit, stated that Biz2Credit may start providing PPP loans directly to small businesses across the country as funding availability permits.
“Many of the smallest businesses – often women-owned and minority-owned companies that are chronically underserved by banks – have encountered tremendous difficulty in securing PPP funding. We will leverage our technology and more than a decade’s worth of experience in small business lending to help companies that desperately need this money,” Arora added. “We are ready to help.”
Arora also explained the COVID-19 pandemic has exposed the fact that countless small businesses do not have either the cash reserves to operate for more than a few weeks on their own without assistance or ready access to desperately-needed working capital. Following this approval, Biz2Credit will continue to use its online lending platform to help small businesses apply for government-backed PPP loans.
