New Lender Designed to Support Underserved SMEs
July 23, 2024A new specialist lender has today been launched in response to evolving SME funding needs.
Rapital is set to transform the financial landscape to support both brokers and SME businesses facing difficulty in securing funding from existing lenders and banks.
Rapital will focus on offering a direct route for clients with challenging credit situations, such as poor credit, existing loans, CCJs and defaults with loans ranging between £5,000 and £250,000. With a focus on offering fast funding, Rapital aims to make decisions in as little as three hours so SMEs can access the cash boost they need quickly.
Access to funding is an evergreen issue for the UK’s vital SME community, with many struggling to get approval from traditional lenders. Indeed, according to the National Association of Commercial Finance Brokers’ (NACFB) annual lender and broker survey, 32% of new clients successfully funded by its members last year had been previously denied funding elsewhere – a 3% increase from 2022. Rapital has been launched to help close the gap and enable SMEs who might have been denied financing from traditional lenders to get the cash boost they need to succeed.
Rapital’s ambition is to help turn a “no” into a “yes” for SMEs needing rapid and flexible financing solutions. The service promises an easy, transparent process and same-day funding, empowering businesses to thrive and grow. In these challenging operating conditions, it is vital that smaller businesses have access to rapid and flexible capital. Rapital will offer a much-needed financial lifeline to the business profiles and industries that are often rejected by banks and other SME lenders.
About Rapital
Rapital’s mission is to empower businesses of all sizes, credit backgrounds and industries by providing brokers and SMEs with funding solutions tailored to meet the real-world challenges they encounter.
For media inquiries, please contact:
Rapital Media Team
Email: info@rapital.co.uk
Phone: 0161 884 0767
Website: rapital.co.uk
Ponzi Schemer Continued to Run Ponzi Scheme From Prison Phone
July 22, 2024Don’t syndicate with New Beginning Global Funding LLC, New Beginning Capital Funding LLC, and Lion Heart Capital Group L.L.C.
That’s because these entities were just named in a federal plea agreement as belonging to Johanna Garcia, a now-convicted ponzi schemer currently serving time in Miami’s federal detention center. Readers might remember her as being the mastermind behind a fake MCA company known as MJ Capital Funding. Garcia raked in more than $190 million as part of a fake syndication/investment scheme from thousands of duped investors. The SEC shut the company down in 2021 and she was charged criminally last year.
She did not go down quietly. Apparently after the SEC shut down her entities she simply set up new entities and kept going. When she was finally arrested and jailed awaiting trial she continued the ponzi from the prison phone and email.
In a proffer signed by Garcia, it’s stated that “Garcia and her co-conspirators told investors that their money would be used to fund general contractors who worked on commercial and residential properties through merchant cash advance loans. In truth, bank records show that there was little to no merchant cash advance activity, and the money raised was used to pay off previous investors.”
Garcia, and those that participated in the scheme with her, used MCA as a cover for their scheme. She was not actually known to people in the industry nor actually worked in it.
How The PPP Reporting Oversight Harms MCA Companies
July 18, 2024David Roitblat is the founder and CEO of Better Accounting Solutions, an accounting firm based in New York City, and a leading authority in specialized accounting for merchant cash advance companies.To connect with David or schedule a call about working with Better Accounting Solutions, email david@betteraccountingsolutions.com.
deBanked’s recent story covering the news about how the Small Business Administration (SBA) failed to report many Paycheck Protection Program (PPP) loan charge-offs to credit agencies is a major concern for merchant cash advance companies.
As the AltFinanceDaily article explained, a new report from the Office of the Inspector General (OIG) found that the SBA did not report 37% of PPP loan charge-offs, and missed deadlines 97% of the time. The OIG report stated that the SBA’s automated system was supposed to report these loans, but it did not always work correctly. As a result, many delinquent borrowers could still get new loans because their bad debt wasn’t reported. The report also pointed out that a large portion of early PPP loan charge-offs were linked to potential fraud, which makes the lack of reporting even more serious.
This oversight could cause real problems for our industry. As an accountant working with MCA companies for over a decade, I understand firsthand how important accurate credit reporting is for making sound and fully informed decisions on which merchants our clients choose to invest in and help advance.
For MCA companies, this incomplete reporting leaves a critical gap in the information that funders rely on. Without accurate credit information, it’s harder to assess the risk of advancing capital to any particular merchant, which can lead to higher chances of defaults and financial losses when you don’t have a complete history that includes any times they’d skipped payments or defaulted. The missing data from the SBA means MCA companies might unknowingly fund high-risk businesses, which ultimately harms the cash advance company itself.
To work through this situation, funders need to take stock of how they evaluate prospective merchants to work with.
First, it’s important to do thorough background checks using multiple sources of information. Relying on just one credit report isn’t enough, especially now that we know there might be gaps. Cross-referencing data from various sources will provide a more complete picture of a merchant’s credit history.
We can also require merchants to provide more documentation and financial information before approving funding deals, removing a complete reliance on credit reporting agencies that have now proven themselves fallible. Pairing up the complete history that they provide along with their credit reports, and continuous tracking of the deal on a strong internal MCA CRM that lets you know of any hiccups, is a proactive approach that helps in making informed funding decisions.
It’s vital to develop strong risk management strategies. This might include setting stricter funding criteria, diversifying the types of businesses we lend to, and keeping enough reserves to cover potential losses. By being cautious and prepared, we can protect our companies from the financial risks posed by incomplete credit reporting, and eliminate our over reliance on that one source of information.
Let’s use this opportunity to ensure we are making the best funding decisions possible, and continue to have healthy companies built on stable foundations.
Capify Appoints Think Business Loans Founder as Director of Strategic Initiatives
July 18, 2024
Capify, a leading SME lender, has appointed Jamie Stewart as Director of Strategic Initiatives. Jamie, the founder and former MD of Think Business Loans, brings extensive experience and SME expertise to Capify. In his role at Think, he successfully oversaw the deployment of over £1 billion in funding to more than 10,000 customers, prior to its sale to Bionic in 2019. Since then, Jamie set up Anidea, a Strategic Consultancy firm.
Jamie’s arrival marks another milestone during a significant growth phase for Capify. Having leveraged a new £100 million credit line from Pollen Street Capital earlier this year, the company has made a succession of senior team appointments recently and is actively developing an expanded product suite.
“I’m thrilled to join the team at Capify as Director of Strategic Initiatives,” said Jamie Stewart. “Capify is a pioneer in the alternative lending space, with a solid foundation and a clear vision for the future. As a forward-thinking entrepreneurial company with a new range of innovative products, Capify is poised for significant growth. I look forward to collaborating with the team to develop new partnerships that will further enhance our ability to provide quick, reliable funding solutions to SMEs.”
Founded in the UK in 2008 during the global financial crisis, Capify has become a vital financial resource for small and medium-sized businesses. Recognised for its commitment to excellence, Capify was awarded SME Lender of the Year (up to £1m) at the UK Credit Awards last year. Originally launched in the United States in 2002, Capify was one of the world’s first online alternative financing companies for SMEs. Since its creation, Capify has supported over 20,000 businesses and funded over £1.2 billion to help SMEs achieve their growth ambitions.
John Rozenbroek, COO/CFO at Capify, commented, “We’re delighted to welcome Jamie to the Capify team. His extensive experience in SME lending and his proven ability to drive strategic growth are exactly what we need as we expand our operations and introduce new products. Jamie’s insight and leadership will be invaluable in achieving our mission to support SMEs with the funding they need to thrive.”
“Jamie’s appointment underscores our commitment to strategic growth and innovation, ensuring it remains at the forefront of the alternative finance industry, delivering unparalleled service and support to SMEs in the UK”.
ABOUT CAPIFY
Capify is an online lender that provides flexible financing solutions to SMEs seeking working capital to sustain or grow their business. Originally started in the US over twenty years ago, the fintech business now operates in the UK and Australia and has served these markets for over 15 years. In that time, it has provided finance to thousands of businesses, ensuring the vibrant and vital SME community can meet the challenges of today and the opportunities of tomorrow.
For more details about Capify, visit:
http://www.capify.co.uk
Media enquiries
Ash Yazdani, Marketing Director
ayazdani@capify.co.uk
eBay Brings Back Revenue Based Financing Product
July 12, 2024eBay announced that Liberis had been onboarded as one of its “Seller Capital” partners this week, making it the second official partner after Funding Circle (which was recently acquired). Liberis, homegrown in the UK, expanded to the US in 2020 and offers a revenue based financing product described by eBay as a “Business Cash Advance.” While eBay has partnered with similar companies in the UK for years, eBay customers in the US have seen this before.
In 2010, for example, Kabbage was arguably the first company to offer revenue based financing to eBay customers, which AltFinanceDaily first covered 13 years ago. And they had it all to themselves until PayPal began to muscle its way in with a similar product starting in 2013. Given that eBay owned PayPal, PayPal held a distinct advantage until the two companies split in 2015. Still, PayPal continued to be the default payment service for eBay until 2018.
Kabbage continued to thrive anyway, evolving beyond the platform at least until covid when Kabbage suddenly imploded and was sold to American Express. PayPal’s working capital product also continued to thrive at least until 2023 when it announced a dramatic pullback after elevated charge-offs.
The result is that in 2024, eBay sellers can now look toward getting funding via Liberis.
“As a pioneer in ecommerce and the home to small businesses in more than 190 markets, eBay understands the challenges small businesses encounter in securing fast, flexible and transparent financing,” said Avritti Khandurie Mittal, VP & General Manager of Global Payments and Financial Services at eBay in the official announcement. “eBay Seller Capital is aimed at fueling our sellers’ growth by providing them with tailored financing solutions that meet the unique needs of their businesses. The addition of Business Cash Advance to our suite of offerings in partnership with Liberis enables us to expand capital availability for our sellers on flexible terms – when they need it the most.”
“We understand the unique challenges eBay sellers face when securing financing through traditional means,” adds Rob Straathof, CEO of Liberis. “Through eBay Seller Capital, Liberis will empower sellers with access to fast and responsible financing. We’re thrilled to partner with eBay to support eBay sellers to operate and grow their businesses.”
FundKite Launches Merchant Services Division
July 11, 2024Miami, Florida – July 11, 2024- FundKite, a leading provider of financial solutions for small businesses, today announced the launch of FundKite Merchant Services, a new payment processing division that expands the company’s suite of products, offering low fee merchant services and quick access to their funds.
Small businesses in today’s economic climate are seeking capital, quality payment processing, lower costs, and real time knowledgeable customer support partners – particularly amid an uncertain economic future, tightened cash flow, and limited access to traditional financing.
FundKite Merchant Services provides a comprehensive suite of solutions for small and medium sized businesses, including competitive rates, industry veterans with unparalleled expertise, and top-notch service and support. Supporting all major credit card networks, FundKite Merchant Services equips small business owners with best-in-class payment technology to better facilitate credit and debit card transactions with reduced fees, daily financial reporting, acceptance of other forms of electronic payments through secure, state-of-the-art point of sales systems, check guarantee, and more.
With the new division, FundKite expands on its mission of empowering small businesses with accessible services to simplify their finances and allow them to save on processing costs. Additionally, businesses that choose FundKite Merchant Services benefit from integrated support with customized funding solutions, aiding in the management of cash flow and working capital.
“Given today’s challenging economic climate, high interest rates, strained cash flow and increased difficulty in meeting lending criteria from traditional financial institutions, it’s more crucial than ever to help Main Street American thrive, by offering savings through unique payment solutions and alternative financing options,” said Alex Shvarts, CEO of FundKite. “These businesses are evaluating and upgrading their outdated, legacy payment processing providers. We’re seeing an incredible demand for our products and are proud to offer small businesses a wider suite of solutions, so they not only survive but grow.”
To date, FundKite has processed over 200,000 business funding applications across the country. FundKite’s continued expansion reflects its ongoing mission to serve as a trusted partner for entrepreneurs seeking financing. By offering flexible funding options, personalized service, and prioritizing long-term relationships, FundKite remains dedicated to supporting entrepreneurial ventures across the nation with their revenue-based financing solution, and now merchant services division.
To learn more about FundKite Merchant Services, please visit here.
About FundKite
FundKite is among the fastest-growing fintech companies, introducing a unique approach to the longstanding financing industry. Utilizing a boutique funding style, FundKite provides businesses of all sizes, ranging from local small shops to major global firms, with a flexible array of products and services tailored to fit their individual financial needs. Positioned as one of the fastest-growing firms in the small business funding industry, FundKite offers up to $2,000,000 in working capital for each qualified business.
Media Contact
Fundkite@5WPR.com
Law Firm Sued Over “Debt Relief” Practices
July 9, 2024Another alleged “debt relief” law firm is under fire by a small business lender. This time the lender is National Funding and their latest lawsuit names not only a borrower that breached a loan agreement as a defendant but also a New York based law firm named J.S. Fritzon Law Firm, P.C.
According to the Complaint filed in San Diego County of California’s Superior Court, after the defendant law firm identifies National Funding’s customers, they contact them, offer to provide debt relief services, and attempt to persuade them to breach their obligations.
“As part of this effort, Non-Borrower Defendants routinely make misleading representations to National Funding’s customers, including by promising to save them money by settling their obligations to National Funding for a discounted amount when Non-Borrower Defendants have no legitimate basis for making such a promise and no reasonable expectation of being able to fulfill such a promise,” it says.
Among the causes of action against that defendant in particular are Intentional Interference with Contractual Relations, Unfair Competition, Conducting Business as a Prorater Without a License, Unauthorized Practice of Law, and Violation of Uniform Voidable Transfer Act.
The case number is 37-2024-00021246-CU-BC-CTL.
Kapitus Closes $45 Million Investment-Grade Corporate Note Financing
June 18, 2024NEW YORK, NY JUNE, 18, 2024 — Kapitus, a leading provider of financing for small and medium sized businesses, today announced the closing of a $45 Million investment-grade corporate note financing. The closing of this most recent financing increases the Company’s total debt facilities to $585 Million. Proceeds from the transaction will be used to further expand the Company’s portfolio of financing products and making further technology investments in its funding platform, making it easier for more small businesses to acquire critical growth capital more quickly.
“With this most recent round of financing, Kapitus reaffirms its commitment to stand ready to support small businesses with fast and efficient funding alternatives. Recent research continues to show that businesses are finding it more and more difficult to access capital as both bank and non-bank lenders pull back,” said Andrew Reiser, Chief Executive Officer of Kapitus. “By expanding the products we are able to provide and enhancing the speed in which small businesses can receive financing, we will be able to address the unmet needs of thousands of small businesses across the U.S.”
To date, over $6 Billion in growth capital has been provided to almost 55,000 small businesses through Kapitus.
“This capital raise also shows a vote of confidence from our investors in our business model, diversifies our capital structure, and gives us flexibility as to how and when we deploy capital to support small businesses,” adds Anthony Rose, Chief Financial Officer of Kapitus. “Despite a tight credit environment, we continue to see opportunity to provide capital to small businesses and this raise further enables us to execute our strategic plan more effectively while maintaining our focus on delivering enhanced value to small businesses”
Brean Capital, LLC served as the company’s exclusive financial advisor and sole placement agent in connection with the transaction.
About Kapitus
Founded in 2006, Kapitus is one of the most experienced and trusted names in small business financing. As both a direct lender and a marketplace with an expansive network of financing partners offering a variety of products, Kapitus has provided over $6 billion in growth capital to almost 55,000 small businesses. Kapitus, either directly or through trusted partners, offers products tailored to the need of every small business including term loans, sales-based financing, SBA loans, equipment leases, and revolving lines of credit. For additional information about the company, visit: https://kapitus.com
Media Contact:
Jackie Quintana
Pitch PR
Jackie@PitchPublicRelations.com
480.606.8180
