Business Capital Group Launches New Referral Marketplace for Loans
The Association for Enterprise Opportunity is hoping to make it easier for small businesses to raise money through its new MyWay to Credit referral marketplace.
One of the many challenges that small businesses face is where to start when looking for credit.
The Association for Enterprise Opportunity hopes to solve that problem with a new referral marketplace called MyWay to Credit. Launched formally this week, the service aims to make it easier for small businesses that are struggling to qualify for financing to find a funding source—whether through a community lender or a small-business mentor.
AEO President and CEO Connie Evans said the credit gap can be damaging to Main Street businesses.
“Every business day, thousands of requests for credit from small-business owners are not met due to a lack of capital, low cash flow, short credit history, or other issues,” Evans said in a news release. “This presents an opportunity to meet their needs through nonprofit community lenders supported by banks.”
The endeavor has received support from the banking industry, including Woodforest National Bank and JPMorgan Chase. An investment from JPMorgan Chase’s $150 million Small Business Forward initiative aims to make the MyWay to Credit system replicable.
Federal support of community development financial institutions (CDFIs) also helped get the program off the ground. In 2015, AEO won the Treasury Department’s CDFI Fund Innovation Challenge, which led to a proof of concept for the marketplace.
The average small business has just 27 days of cash buffer, according to the JPMorgan Chase Institute.
“CDFIs can play a key role in providing access to flexible capital and additional technical assistance to help small businesses grow,” Andrew Kresse, JPMorgan Chase’s CEO of business banking, said in the release. “It’s why we’re proud to not only financially support but also collaborate with AEO on myWay to Credit to connect all small businesses with alternative funding and additional mentorship resources.”
(MyWay to Credit screenshot)