HSBC to offer online small-business loans in Canada
HSBC Bank Canada is working with the software provider Biz2Credit to launch a new digital loan product for small businesses.
The London banking giant’s Canadian subsidiary will launch HSBC eCredit across the entire country in English in December and will make the loans available in French the following month. Currently, the product is available by invitation only in certain areas.
Biz2Credit’s software suite includes data analytics, automated underwriting and monitoring services for the loan program, CEO Rohit Arora said in an interview Monday.
“This is a big step forward,” he said. “HSBC is a very large bank and they’ve shown that the way to work is with fintechs. It’s very easy and also scalable.”
Banks are increasingly partnering with fintech companies to simplify the application process and speed up decision making for small-business loans.
For example, the $9.5 billion-asset Popular Bank in New York announced a similar deal with Biz2Credit in October, while JPMorgan Chase and PNC Financial Services Group have contracted with OnDeck to provide the technology for their digital small-business loans.
“HSBC eCredit will deliver a straight-forward and efficient lending application to our small business banking customers, enabling them to spend more time running their business and give them time to grow their customer base,” Jeff Brown, head of retail business banking at HSBC Bank Canada, said in a press release.
Currently, small-business borrowers can apply for an unsecured loan amounts up to $125,000 through HSBC eCredit, but Arora said that the bank will launch a secured loan for up to $1.5 million early next year.
Arora said that applications can be completed in under five minutes and decisions can be in as little as 24 hours. Borrowers can apply on a mobile phone, desktop or laptop computer.
HSBC will pay a licensing fee to Biz2Credit for the software, but Arora did not disclose any other terms of the deal.
Biz2Credit has partnerships with “seven or eight” banks globally, Arora said, but this deal with HSBC Bank Canada is the first in that country.