Small Business-Focused Online Lenders Launch New Coalition
The rise of online lending brought forth by the Dodd-Frank Act is leading to new industry needs, and the Coalition for Responsible Business Finance, which is backed by a number of small-business trade groups, is ready to represent the industry before Congress and elsewhere.
The world of online lending is getting an association of its own.
On Tuesday, the Coalition for Responsible Business Finance (CRBF)—a venture that’s backed by the National Federation of Independent Business, the National Small Business Association, and the Small Business & Entrepreneurship Council—announced its formation. The group hopes to represent firms focused on lending to small businesses, a budding sector with concerns different from those of traditional lenders.
The coalition, led by Tom Sullivan, former chief council for advocacy at the Small Business Administration, will help to set standards for the industry, which is still new but growing fast on the back of shifts in small-business lending encouraged by the Dodd-Frank Act. The association hopes to also work with legislators to educate them on the needs of nontraditional online lenders.
“CRBF was created to educate state and federal policymakers, media, and communities on how technology and innovation are providing small businesses access to capital that is necessary for growth,” Sullivan said in a news release. “CRBF is a much-needed voice for an industry that is doing tremendous things for small businesses, the jobs they create, and the U.S. economy as a whole.”
In comments to American Banker (subscription required), Sullivan noted that the CRBF’s ties to a number of small-business trade groups were no accident.
“If you have industry saying that they want to help small business, then small business has to be part of it,” he explained.
At this juncture, the coalition includes five members, including the lenders Breakout Capital, Fundation, and The Business Backer. Two other industry support firms are also on board as members: data provider Paynet and loan-servicing firm Orion First.