JP Morgan Chase, North America’s biggest bank, is launching a venture with online lender OnDeck Capital to accelerate the issue of loans to its four million small business customers in the US.
Reports suggest that the joint venture will launch as early as January, when Chase will begin offering loans of up to US$250,000 (£166,000/€236,000) using OnDeck’s platform to provide real-time approvals and same-day or next day funding.
JP Morgan Chase’s chief executive (CEO), Jamie Dimon, recently revealed the bank’s planned collaboration and said that the venture would allow it to provide “the kind of stuff we don’t want to do or can’t do.” Online lenders utilised non-traditional data to “determine whether someone is a good credit or not,” he added.
OnDeck has lent more than US$3bn to US small firms since it was founded in 2007, although there has been criticism that it charges premium rates in return for the speed of its service.
Jennifer Piepszak, JPMorgan’s head of business banking, confirmed that the new product will carry the Chase brand. Describing the venture with OnDeck, she added: “It really originated with a need to remove pain points and just make the process easier,” she said. “We obviously have the lending experience; they have a disruptive customer experience that we’re very interested in.”
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