Lenderfit – Simplifying Small Business Lending
After several years of work in the microlending space, with the generous support from the Ewing Marion Kauffman Foundation, we’re announcing our latest endeavor to increase access to capital through the creation of a new customizable digital platform called Lenderfit. Lenderfit will allow other lenders to offer the same non-collateralized, non-credit based loan product that we have piloted in Louisville, KY, while also making it easier for small businesses to provide essential information for any of the products they currently offer.
We’ve said it before, and continue to believe, that Small Business owners are the unsung heroes of every community! In order for these small businesses to thrive they must be able to access capital, but the cost for lenders to lend in smaller increments are quite high. With fewer employees and less business history, obtaining the necessary information to approve a loan can consume a significant amount of time.
Lenderfit is our most ambitious effort in breaking down access to capital barriers for small businesses around the country.
Over the past 5 years we’ve have focused our energies on direct access to capital solutions both locally and nationally. The Growth Loan, for example, is a local loan product that eliminates the need for financial collateral and minimum credit scores. Nationally we’ve launched crowdfunding opportunities for 0% interest Kiva loans in 4 different states. Both of these efforts have lead to more than $2 million in community funded, non-collateralized, micro-loans for hundreds of small businesses.
While creating and supporting direct access to capital solutions, certain systemic issues began to appear through experience based learnings that were less evident in research studies. In many of our conversations, lenders expressed that they spend anywhere from one third to two thirds of their time requesting, reviewing, and organizing essential information from small business owners. The reason being, lenders lack software solutions that are specifically designed to collect useful documentation from business owners who operate informally with little time to engage in a loan process that might result in a no. On the small business side of the equation a study by the NY Federal Reserve cities that of all the frustrations involved with obtaining financing, a lack of transparency was the biggest issue for those who applied.
Sadly, there are few software solutions available to assist in creating and providing the information that lenders are seeking in an intuitive small business friendly way. It’s very challenging for small businesses to provide information that is not readily available or completely foreign to them while still running managing day to day operations. Lenderfit creates an interactive shared checklist with helpful reminders and explanations that empower business owners to make progress during the small gaps of time that are available. Through an online dashboard, and a simple phone app, Lenderfit creates the transparency that small businesses crave while saving lenders time and reducing the costs associated with small business lending.
Time and again, communities across the country have all described similar pain points. Small business lenders and small businesses themselves are struggling to connect. Struggling to discover each other, and then struggling to either create or obtain enough information to make a final loan decision. By reducing the the time it takes to collect information, and demystifying the process for so many hard-working entrepreneurs, Lenderfit is making it easier for both lenders and small businesses owners to achieve their goals.
Lenderfit is our most ambitious effort in breaking down access to capital barriers for small businesses around the country. We’re already working with lenders in Kansas City and Louisville, and we’re looking for one more community of lenders to help in piloting this new technology. Whether you’re an individual lender, or a community leader, we’d love to hear from you! Find out more, and connect with us, at www.lenderfit.io.