Small businesses unable to obtain a loan through conventional means may try SBA backed financing. But even this option can take months. San Francisco-based Better Finance is launching Smartbiz, and hopes to whittle that wait time down considerably. The company says Smartbiz is the first online fully-automated SBA loan program.
Better Finance has partnered up with Sacramento’s Golden Pacific Bank and the U.S. Small Business Administration to launch the new venture. Beyond being automated and online, the program will answer applications on SBA-backed loans within 5-7 days. That’s compared to the 60 to 90 days an application process can typically take. And the company says applying in the first place should only take about 20 minutes.
The new online program will let you apply for SBA backed loans of between $5,000 and $150,000. You also have longer to pay the loan off and the monthly payments are low. If you have a few good months of revenue, Smartbiz will not penalize you if you are able to pay the debt off early. In a prepared statement accompanying the announcement, SBA San Francisco District Director Mark Quinn explained:
“Because bank funding typically takes so long or is unavailable for loans under $150,000, most small business owners turn to alternative, more expensive lending sources like merchant cash advances or credit cards to fill the gap…SmartBiz offers affordable monthly payments and fills a significant void in the marketplace, offering an enormous opportunity to better serve small-business owners with easy online access to a low interest rate SBA loan.”
SmartBiz says they have already provided SBA loans to some small businesses. One of them is Wild Birds Unlimited in Fort Collins, Colo. Also in a release accompanying the announcement, Wild Birds owner Lauren DeRosa said:
“SmartBiz helped my business obtain a loan for capital improvements in my store and for cash flow assistance…The process was fast and easy to understand – all I did was fill out the information on their website, and if I did have any problems downloading information or answering questions throughout the loan application process, I called their helpline and received excellent customer service.”
Image: Smartbiz
SmartBiz backed by SBA can truly help businesses financially, when the same is required. As these kind of initiatives can truly turn out to be a helpful hand for small businesses to come out of bad financial status.
I applaud Better Finance and Smart Biz for creating an online SBA application that can be processed on SBA loans under $150,000, and SBA for supporting this effort to streamline the process. I agree that many qualified businesses looking for loans under $150,000, seek more expensive alternatives becuase of the long time and uncertainty in the traditional SBA application process on smaller loans. I look to hear more about the success of this endeavor, and expect this will be a trend others will follow.