1 Episode results for "Lake Pay Pal"

Small business emergency lending program expands fintechs portfolios

Marketplace Tech with Molly Wood

09:27 min | 5 months ago

Small business emergency lending program expands fintechs portfolios

"Some companies are now in these small business lending program but even they can't seem to hack the system from American public media. This is marketplace tech demystifying digital economy. I'm Ali would the paycheck protection program is a weekend to its second round of hopefully funding small businesses through the corona virus outbreak. Some financial tech companies also known as Syntax got permission from Congress to offer those loans. They include pay pal into it cabbage and others. The hope is that they can get loans to people and businesses who haven't worked with traditional banks in the past and the Fintech say they're tack is also an advantage but so is that true. Let's dig into it and quality assurance the segment where we take a second look at Big Tech Story Felix. Salmon is chief financial correspondent for the tech site axios. The banks were a bit slow to be able to set up websites that customers found it impossible to get to a to a human being or to find out where they stood whether their applications were going through and there was a general feeling that given that all of this was being done on the Internet the Internet companies might be better doing it than the banks were so relatively quickly. This program was opened up so that the eligible lenders included not only banks but also Internet companies Lake Pay Pal and quicken and square. Gotcha I mean. I feel like one of the questions about these lenders. And FINTECH companies and neo banks in particular is that in some ways they serve. Replace this idea of the Community Bank. Like do we have any evidence that they are or could be more inclusive than established lenders. I think they are in the if you applied for P. P. Loan from pay pal. Then your chances of guessing it. We're probably the same no matter who you were given that many of the people applying if not most of the businesses applying had no particular relationship with these Fintech to begin with now doesn't mean they're going to get that loans. It's far from clear that the ability of pay pal to get loans through the SBA system and get people. Funded is any greater than any other bank. But at least you can feel that you're on a level playing field if that's any. Solis which you probably isn't to be honest. Who is applying through? Let's say pay pal or square or into it. Who are these small businesses to a first Brooks mission? Everyone who didn't get a loan or wasn't able to get through when applying through that bank. Whatever the reason was if you haven't got your money it's not give up on your bank entirely but you say well. Maybe I can't get a loan through my bank. I should try a getting along with someone else and given the it's not difficult to apply through pay pal. Oh quicken intuit it. You May as well try if they come back to you and say hey you've been funded. Brin and you can take the money and if they don't it's no harm no foul and is there any evidence or will there ever be a way to tell you think whether they claim that these kind of like tech driven platforms are more nimble and better able to get your application through than a big bank the banks and the Fintech have all been extremely unhelpful? When people like you and me have been asking them for details about how many people try to apply. How many of those people who try to apply actually got their money those ratios on not public information than the information that the SBA has see you need to get that information directly from each one. And I don't think any of them are going to be releasing that data on the kind of apples to apples basis that we'll be able to make that determination. Is this an opportunity for these companies like if they are able to establish themselves as this type of lender or just do good by some small businesses is an opportunity for them to build a customer base down the road I think for about twenty four rows an opportunity to get some goodwill? I think the small business owners actually went to those places putting their applications and then didn't receive any money that some of that goodwill did evaporate. What's more of these companies? Aunt actually lenders at heart companies like paypal and square a much more based on payments on loans. And so. It's not clear that even if this did give them a foot in the door when it came to small business lending that something that they would really want to be right and it feels like certainly some of them have provided loans like cabbage are into it but the others haven't to think they're likely to discover that in fact. This is a terrible morass that they would like to back out of slowly. Small business loans were horrible thing to be in in general because small businesses so many things can go wrong is so difficult to really get under the hood and find out how credit worthy they are for. P. It's different because it's all guaranteed by the government so you don't need to spend too much time really underwriting the loan and understanding the business before extending the credit but if you want to actually lend money to small businesses as part of your business especially if you're doing unsecured and you're not you don't have access to cash flows which you can just S- ts to pay back the loan. Then yeah it's really Nali business where lots of lenders have become unstuck. And it's not clear that very many investors want these companies to get into that line of business like salmon is chief financial correspondent for the tech site. Axios now some related links other Pantex and so called neo banks are also trying to entice new customers or serve the ones they have in different ways. During this pandemic the Neo Bank chime gave all its customers a two hundred dollar advance against their government. Relief checks since many of those checks were slow in coming. It said it's two hundred thousand new sign ups after that according to business insider although to be Sam's point chime said it has no interest in getting into lending and crunch base has a piece this week about how fintech companies are still thriving during the downturn hiring and raising money and in some cases being acquired an analyst told crunch base being approved as small business lenders was actually an additional stamp of approval for the industry. And here's what else were watching in tech actually on the financial tech side the venture. Firm Andriessen. Horowitz says it raised five hundred and fifteen million dollars to invest in crypto currency and blockchain tech and will even buy some crypto assets just to hang onto in case regular money collapses. I Guess Anyway. Yes crypto and blockchain are still a thing even if no one's looking in fact just this month. Facebook released an updated white paper about its digital currency initiative libra which it hopes is more regulator. Friendly watered. Down was appraised that was applied to Lieber two point Oh and on Tuesday the British payments operator checkout dot COM joined the Labor Association okay inside note on Cryptocurrency Forbes reported a couple of weeks back about how coin based data this month shows a sudden spike in bitcoin purchases in the amount of exactly twelve hundred dollars or you know same as a stimulus check and finally we round out earnings week with will the tech giant's save the Economy Amazon. Let's be honest is kind of the one we've been waiting for and it is suitably dramatic. Although Amazon made a ton of revenue off all our extra online shopping it missed on earnings because IT spending a lot of trying to hire revamp logistic chains and maybe occasionally get some protective gear. Two warehouse workers. Hopefully the company said in normal times it would have projected a four billion dollar profit next quarter but instead will spend that entire amount on corona virus related expenses and in its letter to shareholders. Amazon said quote. If you're a share owner in Amazon you may want to take a seat because we're not thinking small in other reports. Twitter actually beat expectations because lots of people are on twitter right now but analysts did not like the part in the earnings call where sex that they like. The rest of US literally have no idea what the next quarter holds and before we roll into the weekend a quick word from one of our marketplace investors who wanted to let us know why she supports our work. I trust the reporting. I'm looking for well. Informed objective and balanced reporting about business technology culture and economy. I find all of this and more in marketplace. That's all a hundred in Lubbock Texas. Thanks to one hundred. And all of our marketplace investors who make public service journalism possible to learn more or donate visit marketplace dot org slash give tech. Stephanie produces marketplace tech. Hey Sue our assistant producer. Robin Edgar is our engineer. Jody Becker is our outgoing senior editor. And we will miss her. I'm Ali would and that's marketplace tech this is APN.

Amazon SBA Ali Salmon Fintech Lake Pay Pal analyst Twitter Neo Bank Community Bank Congress P. P. Loan Lubbock Texas Solis US Facebook Brin Brooks Axios