How 12 payments of £ 23 / month could make a huge difference for SMEs.
Image source: Konstantin Evdokimov / Unsplash.
It is difficult to create credit, especially for new small businesses without a history of repayments.
Always keen to meet the challenges faced by its members, Tide is today launching Credit Builder for Small Businesses, which includes a micro ‘reverse loan’ of £ 240.
SMEs make regular £ 23 / month ‘refunds’ to Tide, then after 12 months receive the full £ 240 refund at no cost to them.
However, just making these regular payments proves their creditworthiness and helps start the process of building a credit score.
“As we emerge from the COVID-19 pandemic, small businesses are working hard to get back on their feet and make up for the most difficult year and a half they have seen,” said Amit Kahana, vice president of Tide Credit Services.
“Investing in growth is high on the priority list for many of these companies, but a poor or no credit rating is often a barrier to accessing credit options.”
Tide’s Credit Builder was created in partnership with the Experian credit bureau, to ensure that repayments are factored into score improvement.
Kahana said Tide found that 87% of its small business owners had a credit score below 80, which clearly prevented them from accessing credit.
“We hope that by providing businesses with an easy way to improve their credit rating, they will see a wider range of credit products open to them, helping to fuel sustainable growth.” “