We have great news to share! Opportunity Fund is forging a groundbreaking collaboration to grow responsible lending with Lending Club, the world’s largest online credit marketplace. With a seamless technology integration forged between Opportunity Fund and Lending Club, the potential for scale is unprecedented and the customer experience will be unparalleled. This transformative partnership was announced by President Bill Clinton at the Clinton Global Initiative America meeting yesterday in Denver.
“Access to capital for entrepreneurs is key to restoring real economic mobility, job creation and the economic health of the middle class. When new credit technologies, such as Lending Club’s, are made available to CDFIs like Opportunity Fund, they can grow to meet the rising demand for capital in underserved communities. Opportunity Fund and Lending Club are committed to pilot an unprecedented partnership. I can’t wait to see what happens,” announced President Clinton.
The initial pilot for this collaboration will provide $10 million in loans over a period of five months to 400 small businesses in underserved areas of California--businesses that would typically be unable to get a loan from traditional lenders.
Opportunity Fund has been lending in disadvantaged communities for twenty years; with this new partnership, we will be able to utilize Lending Club’s best-in-class technology platform to reach many more underserved businesses online. If we can execute successfully during the pilot phase, we will nearly double our impact through this one partnership.
This is a breakthrough collaboration between tech-based and nonprofit business lending, and it draws on the best of both worlds. It points to the future of responsible business lending, and has the potential to take it to a whole new scale.
Renaud Laplanche, CEO of Lending Club, said, “Opportunity Fund has developed deep expertise in providing capital in communities underserved by traditional banking. Through this partnership, our goal is to make our technology available to Opportunity Fund to help them scale further, to meet the needs of a greater number of small business owners.”
The customer experience will be seamless and allow Opportunity Fund to go beyond our current reach. Borrowers apply for a loan through Lending Club, and after Lending Club collects the initial application and performs its automated screening, Opportunity Fund will review the applicants. Opportunity Fund will fund qualifying applicants that otherwise would have been turned down. Opportunity Fund will then service the loans, offering business advice and support to help these businesses succeed.
Access to capital for entrepreneurs plays a key role in economic mobility, job creation, and the health of the middle-class, but bank lending to small businesses has failed to recover since the 2008 recession. Opportunity Fund and Lending Club are proud of this new initiative to help small business owners succeed in this economy.