Fintechs that bypassed banks in partnership hit $1 million loan milestone
The innovative partnership between Prospa and Reckon has proved to be a success.
SME fintech lender Prospa and accounting group Reckon have funded over $1 million loans to small businesses, demonstrating strong demand for SME finance and the success of their platform. The partnership, which was announced in July, allowed Reckon's customers to apply for a loan powered by Prospa.
Reckon Group COO Dan Rabie said the milestone shows the need for alternative business financing.
"There are 400,000 small businesses needing cash flow financing each year which is the highest ranked pain point that keeps small business owners up at night. This issue isn’t being served well by traditional lending sources, so we took a brave step to help the engine room of our economy thrive," he said.
Prospa CEO Beau Bertoli says feedback for the loans, which are for between $5,000 and $250,000 and can be funded in one business day, has been positive.
"To reach this figure in such a short space of time means we’re having a major impact,” he said. "Reckon Loans powered by Prospa is a partnership between two trusted brands. Together we’ve been able to offer business owners a customised approach to access working capital and grow their business.
It was only recently that Prospa reached $200 million in loan originations and closed its latest funding round, raising $50 million in capital. The SME lender also launched an interest-free loan product in October designed to assist entrepreneurs and business owners fund their own education.
Both Reckon and Prospa are optimistic about the future of their business and plan to invest in innovation.
"As the market leader, we’ll continue to invest heavily in developing deeper integrations to improve the partnership and customer journey,” said Bertoli.
Rabie said Reckon similarly had several high-growth opportunities that will foster innovation and improve access to finance for SMEs.
"We’ve developed a smarter breed of online accounting software with the Reckon One platform that’s designed to disrupt high margin incumbents through a game-changing pricing model. Integrations with Reckon Loans within our core product will ensure we are providing our customers with the ultimate in responsive, agile lending,” he said.