OroCommerce features Boss Insights’ thoughts on COVID-19 Impact In Lending
According to CPA Practice Advisor, in a time of crisis, over 69% of businesses struggle with cash flow issues and half do not take measures to prepare for a wide-scale economic downturn.
OroCommerce quoted Boss Insights on the impact in lending: “Lending is based on a model that’s hundreds of years old, a time when businesses had buildings or equipment as collateral”, admits Keren Moynihan of Boss Insights, a fintech startup. In today’s service economy, most companies aren’t in that position and as a result the approval rate is very low – 28% before this crisis.
“Since COVID, the world has gone digital overnight”, continues Moynihan. Lenders are faced with a surge in applications which they are not able to process in a 100% digital and risk-averse environment. Although some applications can see delays in processing, “we see many lenders extending existing loans with the SMB businesses they already support.”
Originally published Apr 12, 2020, updated Apr 12, 2020