Finastra, Microsoft Form BaaS Partnership for Small Business Lending

Finastra, Swift, B2B Payments

London-based FinTech Finastra has launched a Banking-as-a-Service (BaaS) collaboration with Microsoft, according to a Tuesday (April 12) press release.

The partnership is designed to offer new lending options to small- to medium-sized businesses (SMBs), “a sector severely underserved when it comes to accessing finance,” the release stated. SMBs that use Microsoft Dynamics 365 will be able to access financing offers without leaving their business management platform.

“This move will enable [SMB] owners to access relevant and valuable business financing in a seamless and frictionless manner,” according to the release. “Users will be able to unlock lending options within Dynamics 365. With consent from the [SMB], the solution will use information an [SMB] already stores within Microsoft Dynamics 365, making it easier for them to apply for lending.”

With the ability to offer banks additional information, such as accounts receivable (AR) and accounts payable (AR) records, SMBs will see improved lending decisions and faster time to cash, the release stated. Finastra’s payment network of more than 5,000 financial institutions (FIs) in the U.S. will let SMBs access “the most relevant and valuable financing options for their specific business needs.”

Finastra said in the release its SMB embedded finance solution on Microsoft Dynamics 365 will be integrated with open application programming interfaces (APIs) through Finastra’s platform and is expected to go live in the summer of 2022, with an initial focus on customers in North America.

In November, Finastra began working with the IT services firm Hexaware to provide managed services for Finastra’s cloud-based payment solutions.

Read more: Finastra, Hexaware Collaborate to Help Banks Modernize

“The move helps Hexaware customers in Germany, Belgium, the U.K. and Ireland take ownership of their payment infrastructure,” the two companies said at the time. “The partnership brings together the companies’ industry-leading payments and integration experience to provide mid-sized banks with an end-to-end Payments-as-a-Service (PaaS) offering, which helps them remain competitive while mitigating operational costs.”