September 3, 2019
Thought leaders across the globe suggest that the SME market is the next wave of focus for FinTechs. There is a long list of FinTech players that are focusing on payments, B2B systems, and especially, lending solutions. The unmet SME lending requirements present huge opportunities for new-age alternative lending providers to intrude into the system, putting pressure on the way lending is done by legacy banks. In an interview with Forbes, Rob Frohwein, CEO of Kabbage, said, “Banks have underserved small businesses in need of $250,000 or less for decades. And it’s not that banks don’t want to or it’s difficult and costly. It costs them the same amount of money to underwrite a $5,000 loan or a $5,000,000 loan.”
SME-focused FinTech players have delivered innovation across loan origination, underwriting, documentation, data management, profile management, and loan servicing. Unlike traditional lending, alternate lending requires the company’s bank statement for the previous 12 months, supporting documents such as invoice copy, receipts against payments, references, canceled checks, digital footprints of the borrowers, online transaction history, and more.
Klarna and C2FO’s new funding rounds In August indicate promising growth in the SME-focused FinTech segment. With the latest funding round, Klarna became the most-valued FinTech in Europe. Here is a list of 20 such promising FinTech across the globe that focus on ...