OnDeck, which offers a small business lending platform, said Tuesday (Sept. 29) that it has expanded its existing partnership with the Association for Enterprise Opportunity (AEO).
Under the agreement, OnDeck licenses its platform to AEO’s community lending partners, who in turn are working with the AEO TILT Forward Initiative. That initiative is focused on helping small businesses and entrepreneurs who are in underserved communities gain access to capital. The cooperation between the parties and the community development financial institutions (CDFIs) will facilitate up to $10 million in small business loans nationwide.
In a statement accompanying the release, James Hobson, chief executive officer of OnDeck, stated that “OnDeck’s mission is to provide responsible credit solutions for the complete range of small business needs, and high-impact private-nonprofit partnerships such as this are crucial to supporting a financial system that works for all Main Street businesses. When our community-oriented lenders and initiatives have seamless access to leading technology and fair and transparent credit products, that’s when positive change takes place.”
OnDeck — which went public at the end of 2014 after raising $200 million in an initial public offering — has said that its platform helps lenders identify and extend credit to small enterprises that might be overlooked and underserved by traditional lending sources but do indeed meet the criteria of CDFIs. The goal, OnDeck stated, is to have 10 CDFIs participating through AEO by 2016, with an AEO subsidiary, DreamFund, providing capital. In reference to the existing partnership, OnDeck stated that cumulatively the two entities have together originated about $1.5 million in loans, with participation from four CDFIs. The company, which recently had been pushing its P2P platform into Canada, said it waives its fees for the AEO community lenders in an effort to “help build and scale the solution” across the AEO member and partner roster.