Business lender Iwoca has partnered with open finance specialist Mmob to make it easier to embed small business loan provision into banking ecosystems.
Mmob specialises in integrating third party services across a range of banks and fintech platforms. The Iwoca partnership will speed up the credit application process for small- and medium-sized enterprises (SMEs) by removing the need for submitting paperwork.
This follows Iwoca’s quarterly SME Expert Index which found that 38 per cent of brokers had submitted more lending applications for unsecured finance in May this year, compared to the four weeks prior.
In addition, internal Iwoca data has found that half of applications through embedded finance partners receive faster decisions and are 58 per cent more likely to convert than direct applications.
According to the lender, nearly half of loan applications made to embedded finance partners received a decision within two minutes during the first quarter.
“As big banks reduce their risk appetite, we believe embedded finance is the future of SME lending,” said Colin Goldstein, commercial growth director at Iwoca.
“Mmob presents an exciting opportunity for us and a win-win for everyone involved in its ecosystem.
“It will ensure Mmob’s commercial partners can quickly respond to the increasing demand for credit from small and medium enterprises, and enable us to further extend our reach into new sectors by embedding our solution within the financial apps and systems business owners use everyday.”
“Banks and traditional finance institutions face increasing competition from the new wave of digital challengers who can more readily meet the demand for digital services,” said Irfan Khan, chief executive of Mmob.
“Our partnership with Iwoca is a perfect example of how we are helping financial institutions to efficiently and effectively bridge the gap into complementary services that will help build defensibility against digital competitors by keeping account holders engaged, and driving retention and revenue amongst their key market segments.
“There has never been a better time to grab the opportunity offered by embedded finance.”