SMB Lending: Marketplaces vs. Banks

February 14, 2019

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During the last 25 years, about 7% to 9% of small businesses close each year on average – slightly less than the number that open – according to LendEDU. Among the reasons small businesses close, access to credit is becoming less of an issue in why a business closes compared to during the Great Recession: only 5% of businesses closed in 2015 because of lack of credit compared to 14% in 2007.

The democratization of financing due to the expansion of the types of players and credit product options has its pros and cons but one thing is clear – anyone can lend today. Why? Data.

While lending to consumers is straightforward enough in terms of ...

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