Last week, Chase announced the launch of their online small business lending program in partnership with alternative lender OnDeck. Chase’s existing 4 million small business customers are being screened and invited to apply for loans through the program in amounts up to $250,000.
The program has been in the works since December, when Chase announced its partnership with OnDeck. The partnership will likely lead the way in similar pairings of large banks and smaller alternative lenders, who can benefit from the larger bank’s existing customer base. This will keep underwriting fees low and allow them to work with small business customers that traditionally would be rejected due to higher underwriting fees for small businesses.
The platform was created specifically for small business owners who are busy and want faster turnaround.
- 100% online
- Same or next day approval
- Lower rejection rates
Chase and small business loans
Chase is already ranked as the number four most active small business lender in the nation, coming in behind U.S. Bank National Association, Live Oak Banking Company, and Wells Fargo Bank, National Association. It provided 1,497 loans to small business owners in the total amount of $329,860,400 through the second quarter of 2016.
|Rank||Lender||Number of Loans||Total Loans|
|1||Wells Fargo Bank, National Association||4,288||$812,256,200|
|2||Live Oak Banking Company||494||$582,265,500|
|3||U.S. Bank National Association||1,544||$367,268,000|
|4||JPMorgan Chase Bank, National Association||1,497||$329,860,400|
|5||The Huntington National Bank||1,873||$301,077,900|
The rise of online lenders has been met with some scrutiny on the part of small business owners. Scams and dishonest lenders that have surfaced in the past continue to make applicants pay closer attention to lenders that operate online. Because the Chase name is trusted, this partnership has the potential to appeal to small business customers that don’t usually trust online lenders.