A fifth of SMEs bank with fintechs, such as Tide. Financial technology – fintech for short – describes the combination of financial services and technology to provide a larger range of convenient financial services and financial products. Examples of products and services provided by fintechs include primarily app-based banking (such as the service offered by Tide), mobile payments, peer-to-peer payments, and rapid account opening for businesses using data from services like Companies House to verify and open accounts in minutes rather than days (or weeks). Collectively fintech companies are referred to as fintechs.
Fintechs are significantly underrepresented with regards to the Government’s CBILS and the Bounce Back Loan schemes. The banks that are currently accredited have also been overwhelmed by applications and they do not have the systems that fintechs, like Tide, do, to make quick lending decisions based on data.
We applied for financial support from one of the accredited CBILS lenders, a bank we had a business account with for 6 years, and were advised to apply for a credit card, loan, and overdraft. We received a credit card with a 30% APR 10 days after applying but to date, our application for the overdraft and loan has not yet been processed and is awaiting CBILS assessment (which we have been advised that, as of 30th April, will take another 12 working days or so).
Research undertaken by Tide amongst small business owners has shown that collectively, small business’ revenue is set to decline by 57% by the end of April, and that over one in three (36%) expect their revenue to decline by more than 90% in April 2020 compared to April 2019. Time is therefore of the essence to get as many lenders accredited to get the CBILSs and Bounce Back cash out to small businesses as soon as possible.
As a small business we would benefit greatly from the accreditation and inclusion of fintechs in the CBILSs and Bounce Back Loan schemes and as such have written to our MP, Rt Hon Robert Buckland QC MP, to ask for his support in encouraging the British Business Bank to expedite the accreditation of fintechs such as Tide (www.tide.co), a fintech with a 250-strong team of tech and member-focused people using technology to provide more flexible and easier to access banking services for small businesses.
Update 15th May 2020 – Tide have now been accredited for the Bounce Back Loan scheme!
Write to your local MP
Your local MP can champion the inclusion of Fintechs like Tide in the CBILS and BBLS Government loan schemes. You can find their full contact details through a search on the Parliament “Find your MP” tool.
We write to our local MP, Robert Buckland QC MP, MP for South Swindon, to ask him for his support in encouraging the Treasury and the British Business Bank to accredit more fintechs into the Government loan schemes.
If you’d like a copy of the letter we sent that you can personalise to your circumstances just email [email protected]