Germany-based financial software firm Mambu has been chosen to power a new small business lending unit of mobile lender Ferratum, the companies announced Wednesday (July 1).
Ferratum is gearing up to launch its new subsidiary, which will focus exclusively on SME financing and lending, the companies said. Mambu will reportedly connect its cloud platform to Ferratum Business to provide working capital loans for businesses throughout the EU.
“The growing demand for working capital has created an opportunity for lenders to reevaluate their business models to achieve long-term sustainable growth and meet the unserved needs of small and midsized enterprises,” said Mambu CEO Eugene Danilkis.
The loans will be processed through Ferratum algorithms and credit scoring aimed to automate lending application approval. Reports said the partnership will allow small businesses to access financing within a day through the new unit.
“We saw an opportunity to offer small and midsized businesses a new source of financing to support their growth,” said Ferratum Director of Business Lending Scott Donnelly in a statement. “Mambu gave us the ability to quickly and efficiently address a globally underserved segment of the market with an expedited rollout and the ability to service a diverse range of SME products.”
He added that Ferratum has broadened its existing lending capabilities through Mambu’s cloud platform, simplifying the application and approval process.
Ferratum, also based in Germany, recently debut don the Frankfurt Stock Exchange, and reportedly operates across 25 nations in the EU, North America and Asia Pacific. The company said that it plans to roll out Ferratum Business at even more locations throughout the year.
Small business lending is big business in Germany, but the nation is set to implement controversial legislation that aims to regulate the crowdfunding sector. The rules would require small businesses to disclose investment risks and other details of their operations to the public if they wish to raise more than $2.7 million through crowdfunding.