Fintech platform helps brokers tackle business lending

by Julia Corderoy06 Jun 2016
A new online marketplace for business loans can help brokers tackle the growing commercial lending space. 

Launched in November 2015, Valiant Finance is a comparison website which compares and matches business loans, debtor finance and equipment finance to small businesses. 

But unlike other comparison websites which largely focus on home loans or personal lending, Valiant co-founder Alex Molloy said it fills a gap in the complex business lending space.

“[Small businesses] can go to their business banker – who they might have had three of in the last two years – who will ask them if they have residential security and then say they can’t help them if they don’t,” Molloy told Australian Broker

“They could go to their broker or accountant who definitely have their best interests at heart but often don’t have access to or accreditation with the huge amount of online lenders. Then they go online and start searching themselves for online lending solutions. 

“However, they will typically go to the loudest marketing voice with the largest margins on that platform and pay unreasonable interest rates, even though they might have a very healthy business.”

According to Molloy, brokers are its most important resource in helping small businesses gain access to credit. As such, it aims to be a toolkit for brokers to tackle the commercial lending market.  

“We see brokers and accountants as the most important way of dealing with our customers. The reason is the online space is incredibly cluttered. From what we know, about 70% of small businesses have an accountant or a broker, so these are huge influences when they are thinking about credit,” he told Australian Broker.

“They are huge influences who might not have the toolkit to be able to tackle that space, so rather than getting small business to a point where they have their bank say no before they talk to their broker or go online, we want to get in at the start of that process when they are talking to their broker.”

Brokers can choose to work with Valiant in two ways, depending on how involved they would like to be. They can use Valiant as a resource and accreditation or they can refer small businesses clients to Valiant.

“For a lot of brokers currently, with those 26 lenders [on our site], they might be accredited on an adhoc basis with one or two of them. This means they actually have no way of getting commission out of a transaction that they might refer to the other 24,” Molloy said. 

“So brokers can use us as a tool where they do the legwork but they might use our accreditation and quick-matching technology to use a lender they might not have a relationship with. 

“We are happy to operate anywhere in that spectrum where we do the full service or we are used as essentially accreditation and a matching tool.”

A proportion of the commission Valiant receives from settling a loan through its platform will be given back to the broker.

Most importantly, Molloy said, Valiant wants to help brokers, not compete with them. 

“We aren’t interested in disrupting their relationship with their client. Obviously brokerages are incredibly relationship-based businesses. We are very keen to iterate to the market and make clear that when brokers come and deal with us, we never get in contact with the client without their permission and we never market to the client. If the client comes back to us directly, we will continue to treat them as attached to that broker,” he told Australian Broker.
 

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