Plastiq, a B2B payments platform, has unveiled a short-term financing offer to help small and mid-sized businesses in the US drive growth.
SMBs represent a $9trillion total addressable market in the United States yet, according to Plastiq, short-term financing has not previously been available to SMBs in an easy-to-access format.
Small business approval percentages at big banks even dipped in August, according to the latest data by Biz2Credit. The Biz2Credit Small Business Lending Index warns that inflation is hitting small businesses hard as their input costs have gone up.
“Our new solution breaks down the bottlenecks associated with funding growth,” said Eliot Buchanan, founder and CEO of Plastiq. “Many small businesses struggle to pay for large expenses because of a lack of liquidity and access to working capital that is more readily accessible to large businesses and corporations.
“By facilitating the financing process, small businesses can keep cash on hand to remain flexible and responsive to changing market conditions.”
With the Plastiq Short-Term Financing product, any small to medium-sized business can get an instant decision and access to funds to extend a payment by up to 90 days. They can also pay back flexibly in lump sum total or in installments using credit card or ACH.
Plastiq, which raised more than $140million in funding from investors including Kleiner Perkins, B Capital Group and Khosla Ventures, says businesses have already processed millions of dollars in financed payments since the offering was launched in limited availability.
In August, it entered into a business combination agreement with Colonnade Acquisition Corp, which values the combined company at an estimated enterprise value of $480million.