Funding Circle, a London-based financial technology firm, received its small business lending company license last week, nearly four months after the Small Business Administration announced it would issue the license to the company.
When Funding Circle executives met with the SBA on March 5, agency officials said they expected to complete the review and approval of policies and internal controls by April 1 — the date SBA gave the final approval, Ryan Metcalf, head of public affairs for Funding Circle US, told Banking Dive.
The company’s U.S. counterpart is sufficiently capitalized and is preparing to begin offering 7(a) small loans as intended. However, the company has not identified a specific date that it will begin lending, Metcalf added.
Last April, the SBA lifted a 40-year moratorium on non-depository small business development companies that limited the number to 14. In November, the agency agreed to grant SBLC licenses to Arkansas Capital Corp., McKinley Alaska Growth Capital, and Funding Circle US.
The SBLC program is an effort by the agency to modernize itself to meet the needs of today’s small businesses and bridge the gaps in rural and underserved communities, according to an SBA spokesperson.
“The addition of three new SBLC licenses provides needed competition, which is ultimately good for small businesses and the economy,” the spokesperson told Banking Dive via email. “The SBA is proud of the historic action we’ve taken to address long-standing capital access gaps to level the playing field for small business owners, and will continue to pursue novel lending approaches to meet the needs of small businesses.”
Senior executives at the agency led the application process to get the SBLC license, which expanded the SBA’s lending to deserving small businesses. The process included reviewing audited financials, ensuring the applicant was appropriately capitalized, examining small business lending experience, and reviewing proposed business models — the areas where the three new SBLCs excelled, according to the SBA.
Learn more at: https://www.bankingdive.com/news/funding-circle-gets-final-nod-sba-7a-loans-amidst-pushback/712854/
