myWay to Credit Launches
May 1, 2018
Washington, D.C. (May 1, 2018) — The Association for Enterprise Opportunity (AEO), a national non-profit organization dedicated to changing the way that capital and services flow to underserved Main Street businesses, launched myWay to Credit (www.mywaytocredit.com), the first-ever bank referral marketplace for small business lending. myWay to Credit gives options to small businesses that don’t currently qualify for financing by connecting them to a vetted network of community lenders and small business mentors. Early bank adopters played an essential role in the successful creation of the referral marketplace. Woodforest National Bank partnered with AEO during the early design and testing phase, and JPMorgan Chase invested through its $150-million Small Business Forward initiative to ensure the creation of a scalable service that can be repeated for any referral partner regardless of size. Both firms are currently referring customers to the marketplace.
“Every business day, thousands of requests for credit from small business owners are not met due to a lack of capital, low cash flow, short credit history or other issues,” said AEO President and CEO Connie Evans. “This presents an opportunity to meet their needs through non-profit community lenders supported by banks. This credit gap has an impact on the success of Main Street, preventing business owners across the country from growing their businesses, hiring more employees, or in a worst case, keeping their doors open. We are excited to launch this innovative marketplace solution to address this critical issue, and are grateful to the leadership of JPMorgan Chase and Woodforest National Bank for helping to power this launch.”
No company wants to lose a customer, but not everyone has the right loan product or mentorship opportunities for every business. Some business owners also need advice and guidance to help strengthen their business on their path to capital. According to research from the JPMorgan Chase Institute, the average small business holds only 27 days of cash buffer, leaving very little cushion to stay in business if they were to face sudden or unexpected disruption.
“We have a long history of serving the needs of small businesses, and we’re continuing to look for opportunities to support the success of all small businesses, including those who may not currently qualify for traditional capital,” said Andrew Kresse, CEO of Business Banking at JPMorgan Chase. “CDFIs can play a key role in providing access to flexible capital and additional technical assistance to help small businesses grow. It’s why we’re proud to not only financially support but also collaborate with AEO on myWay to Credit to connect all small businesses with alternative funding and additional mentorship resources.”
myWay to Credit harnesses the power of technology to connect small business owners with credit options and mentors. It represents a compelling example of cross-sector collaboration that provides a solution for limited credit, without placing undue burden on any single financial institution. Business owners are invited to myWay to Credit by the referring party, where the owner can opt into the flexible, compliant and user-friendly marketplace. The vetted community lenders in the network are then able to take a closer look at each business to evaluate the owner’s story and promise, in addition to their financial health.
“AEO and Woodforest share an understanding that to succeed, business owners need more than financing alone. This knowledge leads to a shared commitment of providing aspiring entrepreneurs and business owners needed guidance, knowledge and tools so they can access capital,” said Cathy Nash, President and CEO, Woodforest National Bank. “As we know, banks may not always be able to say yes to an applicant, so if this happens, it’s great to have an initiative like myWay to Credit to get borrowers much needed funds, and more importantly, help them back to a path of financial stability.”
The proof of concept for the myWay to Credit marketplace was funded by AEO’s victory in the U.S. Treasury’s 2015 CDFI Fund Innovation Challenge. More than twenty leading community lenders have already joined the myWay to Credit marketplace, after undergoing a robust vetting process to ensure they can provide the highest standards of customer care. AEO’s goal in the upcoming quarters is to continue to expand the marketplace through additional referral partners, sources of credit, and business development services, so that more small businesses have the chance to succeed.
About Association for Enterprise Opportunity
The Association for Enterprise Opportunity (AEO) is the voice of innovation in microbusiness and microfinance in the United States. Since 1991, AEO and its member and partner organizations have helped millions of entrepreneurs contribute to economic growth while supporting themselves, their families and their communities. AEO members and partners include a broad range of organizations that provide capital and services to assist underserved entrepreneurs in starting, stabilizing and expanding their businesses. Together, we are working to change the way that capital and services flow to underserved entrepreneurs so that they can create jobs and opportunities for all. Learn more about the Association for Enterprise Opportunity at www.aeoworks.org.