OnDeck to offer equipment financing to small businesses
OnDeck Capital has announced plans to enter the U.S. equipment finance market next year with a focus on loans of $5,000 to $100,000 to small businesses.
The New York-based online lender argues that its technology will introduce new speed to a market that often relies on paper-based, time-consuming processes.
“We expect OnDeck equipment financial loans to quickly become a vital source of online financing for small-business owners seeking simple, transparent equipment financing,” CEO Noah Breslow said in a press release.
Small businesses often rely on equipment loans to make big-ticket purchases — everything from office furniture to machines used for manufacturing. OnDeck plans to target the smaller-dollar end of the market, offering loans with two- to five-year terms.
Many banks are also ramping up in equipment finance, as strong economic growth and last year's corporate tax cuts have encouraged companies of all sizes to expand.
To lead the business, OnDeck has hired Mark Erickson, who earlier in his career held executive roles in KeyCorp’s equipment finance unit.
OnDeck said that its equipment finance loans will be available to select U.S. small businesses starting in 2019. Since last summer, the firm has been referring small businesses that are seeking equipment financing to another, undisclosed lender.
OnDeck currently offers small-business loans of up to $500,000 and small-business lines of credit of up to $100,000. The 12-year-old company has provided more than $10 billion in loans to customers in the U.S., Canada and Australia.