ShopKeep Expands into SMB Lending

ShopKeep, doesn’t just want to help small businesses accept payments, it wants to help them grow their businesses.

The company, whose cloud-based payments acceptance technology is used by more than 24,000 independent businesses, has launched ShopKeep Capital, a merchant cash advance service.

Through ShopKeep Capital, select eligible merchants across ShopKeep’s customer base will have the opportunity to request a cash advance that can be used toward a variety of business needs, such as purchasing extra inventory, building a new website, expanding their employee base or investing in marketing initiatives. Across ShopKeep’s base of eligible merchants, approximately $5,000 to $25,000 can be borrowed at a time.

“Difficulty accessing capital is an issue most businesses are familiar with, but for the independent merchants we serve, the issue carries even more weight,” said Michael DeSimone, ShopKeep CEO and president. “Having access to funds when needed can be the determining factor as to whether or not a merchant can expand their business.”

One of the key benefits of the ShopKeep Capital program is that merchants will not be subject to fixed, monthly payments, the company says. Instead, a set percentage of the proceeds from their daily sales will go toward paying the balance until the advance has been repaid.

Because the ShopKeep Point of Sale serves as a core component of a merchant’s daily operations, it also provides valuable data that helps ShopKeep identify qualified merchants, while avoiding risks typically associated with traditional loans, the company says.

ShopKeep isn’t the only one interested in the SMB lending space. PayPal recently acquired Swift Financial to boost its SMB lending business while Kabbage raked in some serious green—a $250 million investment—from Japan’s SoftBank earlier this month.

Cashplus and Capital on Tap, two U.K.-based challenger banks that made our Top 5 Best Challenger Banks list, also cater to small business capital needs.

Related stories: 

 

Top 5 Best Challenger Banks: Fidor Bank

Our final spotlight article for our Top 5 Best Challenger Banks list is the only actual bank in the bunch. See how Germany-based Fidor Bank stacks up against the high street banks and its nonbank competitors.

Company Name: Fidor Bank

Location: Germany, U.K. and soon in France

Opened for Business: 2009

Banking License: Yes

Investors/Funding: owned by BPCE, France’s second-largest banking group, which gives Fidor the capability to expand across Europe while helping BPCE brands go digital, too.

Flagship product/proposition: Fidor Bank Community

Fidor Bank has defined a completely new banking relationship for digitally savvy consumers and business customers with its Fidor Community. Fidor believes in openness, fairness and involving customers in the decision-making process. The Fidor Community has become one of the most active financial communities where more than 470,000 users engage in discussions around the clock. The motto of the company is “Banking with friends,” and, as such, Fidor created a community that advise each other, help increase financial literacy, do more with their finances, trade bitcoins, invest and get help from the community with crowdfunding and more.

Fidor realized that people are more likely to go to their friends and family for financial advice than their bank, so it created a community to facilitate that. To keep the community active, members earn financial bonuses, which are converted to cash after becoming a fully KYC customer. They also earn tips from their peers for their help using the “Cent me/Tip me” button.

Secret Sauce: The bank cites many differentiators:

  • The community being the major one. The active community, which is growing organically helps customers understand banking and what best fits their lifestyle or projects.
  • The rewards: Customers are rewarded when they advise their peers, when they transfer their salary, recommend someone, etc. People earn more with Fidor, not less. https://banking.fidorbank.uk/bonus
  • Finance Bay/The Marketplace: The bank  has partnered with more than 42 startups to build a marketplace of curated offers for trading, insurance, financial management, crowdfunding, telco, bitcoin and more. Dubbed Finance Bay, the marketplace is available in Germany, but global banks and fintechs also can join.
  • 60-second banking: transfers, emergency loans (thanks to pre-scoring customers) and payments are done within 60 seconds.

Target customers: Digital-savvy customers

Active customers: 200,000

Growth strategy: Fidor Bank is expanding across Europe, opening in France in 2017, with more countries to follow in 2018. Fidor Solutions, the digital backbone of Fidor Bank now is expanding globally with offices in Dubai, New York and Singapore to collaborate with more like-minded organizations to spread its vision of banking.

Why do you deserve to be on this list? “There are no banks that have a community such as Fidor does, with real fans. We are the only ones who give a voice to people through online forums. We are genuine and open. We let people talk about all financial topics as they wish and enjoy co-creating with them. We continue to think, innovate, test and learn and we believe that our vision of banking fits our digital lifestyle, which will become more widespread as the world evolves.”

Related stories: 

Fintech Trends: the Expected, Unexpected and What’s Next at FinovateFall

By Julie Muhn, Finovate

Anyone who works in fintech knows that the past few years have been a roller coaster ride of trends. So what’s next? How will the year close out?

As we wait for the next four months to unfold, one of the best indicators of fintech trend swells is to watch what companies showcase at FinovateFall (coming up Sept. 11-14). The graphic below shows some of the big trends we’ll see from the demoing companies.

Here’s my take on these themes:

The Expected

  • APIs
    Consumers have come to expect a seamless user experience to better manage their finances. Because of this, banks and smaller financial institutions are beginning to see the value in API-based, plug-and-play add-ons to their existing mobile apps. Therefore, the emergence of APIs as a large trend was expected.
  • Security
    Security has been around since the dawn of man (think fences and moats). As long as there are hackers, security will be in high demand.

The Unexpected

  • Billpay
    Billpay was a significant trend pre-2010 (and pre-smartphone), so it was surprising to see it’s resurgence. The myriad of enabling technologies likely plays a role in the era of billpay 2.0.
  • Blockchain
    It is not that the blockchain trend itself was unexpected this year—it was however, unexpected that it has taken so long to become this prominent. Finovate generally sees at least one or two demoing companies leveraging the blockchain, but in next month’s show the enabling technology is more of a common thread.

What to Watch

  • Augmented reality
    Augmented reality is still in its infancy, especially in fintech. The Pokemon Go phenomenon taught us that users crave a new way to engage and communicate with the world. If we’ve learned anything from the fintech revolution, it is that once this type of user experience becomes commonplace, users will grow to expect it.
  • Mortgagetech
    In the U.S., mortgagetech has been a rising trend in 2017. With room for disruption mixed with outcries for housing reforms, expect to see a mortgagetech growth spike in the next couple of years.
  • Credit scoring
    Big data, artificial intelligence and users’ growing online footprints have created new ways to underwrite borrower risk. The desire to serve individuals with thin to no credit files, along with the need to create an unbiased lending approach, has altered the way underwriters think about credit-scoring techniques.

What’s Next

With four months left in 2017,  I’ll step out on a limb and offer up a few predictions. As far as enabling technologies go, voice banking will start to snowball as Alexa and Google Home becoming more commonplace. Augmented reality will grow—but just slightly—and virtual reality, though it sparkles, will begin a slow death in fintech. Regarding broader industry trends, my colleague David Penn, research analyst at Finovate said, “more human/robo hybrids in the robo advisor field, continued embrace of biometrics solutions for mobile and online banking security, and a resumption in fintech investment for the balance of 2017.”

Want to make your own predictions? Come join us at FinovateFall Sept. 11-14 in New York. Register with Paybefore’s discount code Paybefore20 to save 20 percent on the current ticket price.

Julie Muhn has been covering the fintech world on the Finovate blog since 2011. She has attended 26 Finovate and FinDEVr events across the globe and hosted five events as emcee. You can follow her on Twitter at @julieschicktanz.

In Viewpoints, payments technology professionals share their perspectives on the industry. Paybefore presents many points of view to offer readers new insights and information. The opinions expressed in Viewpoints are not necessarily those of Paybefore.

Earthport Appoints New Head of Europe

Earthport, a London-based cross-border payments network, has named Beau Andersen as head of Europe. In this role, Andersen will be responsible for leading the team and working directly with Earthport’s clients across Europe, implementing all elements of the sales process, business development, account management and sales leadership.

A seasoned European sales director with more than 20 years of experience in the IT products and services market, with particular expertise in the banking industry, Andersen has a track record of building successful technology businesses, including leadership roles at CSC, Rule Financial and Keane, according to an announcement.

Earthport, a regulated payments institution, has established a central clearing hub for payments into 65 countries. The appointment of Andersen represents continued investment in the company’s growth strategy and highlights opportunities in the region.