Intuit has introduced QuickBooks Capital, a lending product targeted at small businesses, and particularly new small businesses. The product joins a growing pool of small business lending options accountants can offer their clients.
The loan solution is currently being funded by a small amount of capital from Intuit, but the company is exploring other models for funding the small business loans, according to Rania Succar, head of QuickBooks Capital, speaking during QuickBooks Connect 2017.
To power QuickBooks Capital, Intuit has created a credit model built from 26 billion data points gathered from small businesses that already use QuickBooks, Succar said. “Because of the trust small businesses have put in QuickBooks, we have access to the most powerful repository of small business data,” she explained.
Succar said that QuickBooks Capital “gets at the heart of one of the biggest unsolved problems a small business faces, which is working capital. If you’re a small business, you might have created an incredible opportunity for yourself to get your product into Whole Foods or Ace Hardware, but there’s one catch: It requires $25,000 of working capital to pay for materials and packaging, which you don’t have. So a lot of business aren’t pursuing those opportunities”
Intuit is especially focused on helping new businesses, executive vice president and general manager of Intuit's Small Business Group Sasan Goodarzi said during the conference, because of their high rate of failure. According to data from the Federal Reserve, 70 percent of new small businesses need funding to grow, but only 23 percent get funding they need — and over half of small businesses fail within the first five years, primarily due to a lack of cash flow.
Despite all this, small businesses are major drivers of economy, which is why Intuit wants to focus on helping them succeed, Goodarzi said.
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