Order to eat. Take an Uber. Booking a flight.

In the age of convenience and instant gratification, any consumer performing these activities can expect to accomplish them with just a few taps on their phone.

“The same thing happens with finance and [among] business owners who have moved their operations online as a result of the pandemic,” Anil Storerco-founder and CEO of the London-based FinTech financial market, said PYMNTS in an interview. “[They] now expect a similar level of service in their business applications and in their consumer applications. »

For the company, which specializes in business-to-business (B2B) lending for UK small and medium-sized enterprises (SMEs), this has meant doubling investment in technology and credit models to meet growing demand for faster application and processing. loan approval.

“[It’s] basically, frictionless funding, that’s been our goal for a long time,” Stocker said, adding that they have their systems in place to ensure people can get a decision within 24 hours of applying for a loan.

And bolstering their systems appears to have served the B2B credit provider well, equipping the business to handle the tenfold increase in loan applications at the height of the pandemic – from 30 million a month before the pandemic to around 300 to 400. million – and leading to a 133% increase in revenue in 2021, the same year the company has achieved profitability since its launch in 2011.

Related News: Tenfold increase in borrowing pushes UK B2B lender market to profit

With this increase in demand for frictionless financing and quick access to funds, Stocker said they are approving more unsecured loans as more businesses move away from the longer and more complicated process of obtaining funds. borrow against their bills or future income.

Read more: UK FinTech MarketFinance raises $382m in debt and equity

And while that might be a riskier option for any lender, he argued it makes good business sense because it’s often the “best companies” who expect a frictionless experience “and the more you put of obstacles, you drive away the good [ones] and end up with desperate people.

Read also: MarketFinance facilitates SME financing with new features

He, however, recognized the need to invest more in technology and sophisticated underwriting models to minimize the higher risks involved. “You have to manage risk in a different way [in the unsecured market] but it’s a good challenge and a good discipline to try to build these very nifty interfaces.

Integrated finance unlocks instant loans

According to Stocker, the shift from bank-controlled offline lending to online applications spurred the first wave of FinTech lending, leading to the current decentralization of finance – a pandemic-driven trend that involves the integration of financial services into applications, sites or ecosystems.

“Exactly the same thing happened with consumers [with] the likes of Klarna or Afterpay integrating into retailers [apps and sites] and offering credit at the point of transaction. The same is now starting in B2B [space],” Stocker remarked, adding that the trend “will completely change the [finance] landscape” in the coming decade.

MarketFinance is exploiting this opportunity with its MarketPay product, which integrates their payment and credit options into online checkouts, allowing vendors to receive instant payment on the first day of purchase, while buyers have up to 90 days to repay the loan to MarketFinance without costs for them.

As Stocker said, integrated finance “is the direction of the journey [we’re taking] – it’s instant, just one click and unlocks [lending] with the fewest clicks.

Changing business models

To date, the UK credit provider has lent more than $3 billion to small businesses to finance working capital products like invoice financing and flexible loans, longer-term loans for larger purchases such as capital expenditure (CapEx), for example.

And while they plan to continue helping profitable businesses that have viable business models, Stocker said they will take into account unintended changes to business models triggered by the pandemic.

He referenced a customer who supplied coffee to offices and cafes in London before the pandemic and had to pivot to delivering directly to people’s homes after everything had shut down.

This change, which required changing logistics, warehouse and adapting their marketing campaign to consumers, cost £250,000 (about $326,500) which MarketFinance provided to support the coffee industry.

“We’ve seen a lot of good companies that were supposed to get money, rethink their business model [and] how they might adapt their businesses,” he noted.

And with the ongoing war in Ukraine, the lockdown in China and supply chain shocks, as well as rising inflation and interest rates, he said the uncertainty caused by these events in the macro level is an indication that demand for UK small business funding will not slow down. down anytime soon.

The UK lender is also aiming to expand internationally to serve SMEs outside the UK – a plan they intend to execute by identifying key trade corridors, leveraging the infrastructure of payment they are developing to help companies buy and sell internationally, and capitalizing on key integrated financing partnerships.

“Over time, you’ll see more and more lending companies succeed in their international expansion and we’re looking forward to this next phase as well,” Stocker said.

Register here for daily updates on all of PYMNTS’ Europe, Middle East and Africa (EMEA) coverage.

——————————

NEW PYMNTS DATA: THE FUTURE OF BUSINESS SUPPLIER INNOVATION STUDY – APRIL 2022

Plastiq - The Future Of Business Payables Innovation: How New B2B Payment Options Can Transform The SMB Back Office - April 2022 - Find out how all-in-one payment solutions can help businesses streamline B2B transactions and eliminate transaction friction. AP and AR management

On: While more than half of SMBs believe an all-in-one payment platform can save them time and improve cash flow visibility, 56% believe the solution could be difficult to integrate with AP systems and existing ARs. The Future Of Business Payables innovation report, a collaboration between PYMNTS and Plastiq, surveyed 500 SMBs with revenues between $500,000 and $100 million to explore how all-in-one solutions can exceed customer expectations. SMEs and help sustain their activities.