Androscoggin Bank launches online business-lending tool
Courtesy / Androscoggin Bank
Androscoggin Bank has launched a new business-lending platform that it says is designed to provide quick turnaround times for prospective borrowers.
Androscoggin Bank aims to beat online-only lenders at their own game through a new business-lending platform that went live in January.
So far, the Lewiston-based bank has processed half a dozen loan applications using the Fast Response Business Loans Platform.
Executives expect momentum to grow as entrepreneurs take advantage of a quick turnaround time for getting loans approved and interest rates of 6%. That compares with charges ranging from 6.98% to 36% to, in one case, 98.4% from non-bank technology “disruptors,” according to a 2016 U.S. Treasury Department report. Such disruptors include BondStreet, Funding Circle and OnDeck, which do not have banking charters and are not regulated by the FDIC.
Chris Logan, Androscoggin’s executive vice president and chief lending officer, told Mainebiz that the bank had worked for 18 months with a fintech firm, whose name he did not disclose, to develop its new platform.
“It was as much a learning curve for them as it was for us,” Logan said. He added that while there have been a few small tweaks since the launch, “for the most part … we haven’t had to make major changes.”
Businesses can use the tool to apply for credit lines of up to $10,000 for business-related purposes or for a term loan up to $100,000 to finance growth. Loans for real estate transactions are not eligible.
While most online marketplace lenders are 100% credit-score driven, Androscoggin bases eligibility on three criteria: credit score, number of years in business and being based in Maine.
“We have combined the best of online lending with the spirit of community banking: a quick answer from a local lender who cares about our client’s experience combined with affordable interest rates,” Logan said.
He added that a formal marketing plan will be rolled out in the second half of this year. Longer term, he said the plan is to raise the maximum loan amounts while restricting applicants to businesses based in the state.
Androscoggin, founded in 1870, had assets of $902.2 million at the end of 2016.
Most Recent
Most Recent
Comments