The Credit Junction, a data-driven SMB lending company, has secured $150m in a credit facility from MidCap Financial.
Credit Junction, which launched in 2015, uses data intelligence and traditional credit metrics to partner with businesses owners to support their financing needs. Businesses are judged on their accounts receivable, inventory and equipment in order to create personalised credit reviews, with the business collateral being used to back up the loan.
The company offers credit lines of up to $7.5m and typically targets supplier, distributor and manufacturer SMBs that have revenues between $5m and $50m. Annual interest rates for loans are 14 to 19 per cent and terms range from six months to 24.
This credit facility will support Credit Junctionâ€™s expansion effort across the US.
The Credit Junction CEO & founder Michael Finkelstein said, â€œWith an expanded capital base, we are enhancing our ability to deliver unique, asset-based lending solutions to support the supply chain economy. We have made significant strides to support the growth capital needs of Americaâ€™s suppliers, distributors and manufacturers that are underserved by traditional banking institutions, and we look forward to working with MidCap Financial to accelerate those efforts.â€
The Credit Junctionâ€™s last funding effort was a $2m seed round in 2014 which was led by GLI Finance, a SMB lender.
Earlier in the year, digital lender and credit solution provider Fundation Group picked up an undisclosed debt facility from Waterfall Asset Management. The company previously picked up a credit line in 2017, with MidCap Financial supplying capital to support the lender.
Marketplace lending companies had a strong H2 2017 for funding, with $6.4bn being deployed globally, according to data by FinTech Global. While the investment volume increased, the number of deals declined.