×

Accounting software giant Intuit launches direct business loans

  • Intuit's QuickBooks Capital uses machine learning to help small businesses demonstrate credit-worthiness
  • The account software firm follows in the steps of a number of tech corporations to offer business loans to its customers
81349final.jpg
Smith Collection/Gado/Getty Images

Financial software firm Intuit is offering loans directly to businesses with a lending product called QuickBooks Capital.

The company, which makes tax-preparation and accounting software, said Tuesday it would enable firms to use its bookkeeping software to access up to $35,000 in credit, with a term between three and six months.

Intuit follows in the steps of a number of tech corporations — most significantly Amazon — to offer business loans to its customers.

"There are a number of tech companies that do small business lending in varying degrees," Rania Succar, head of QuickBooks Capital at Intuit, told CNBC in an email last week. "For example Square, PayPal and Amazon offer loans to merchants."

But Succar said that Intuit's product differed to those offered by competitors.

"As the largest small business accounting platform with approximately 2.4 million customers, the QuickBooks platform provides the most complete set of small business data available in the market," she said.

QuickBooks Capital uses machine learning to help small businesses demonstrate credit-worthiness.

"For example, we give small businesses the ability to get credit for future profits by looking at things such as open invoices", Succar said.

"Using machine learning, we're able to predict when those invoices are likely to be paid, thereby providing an extremely detailed picture of a business' cash flow.

According to a study by the Federal Reserve earlier this year, only 23 percent of businesses younger than five years get access to credit.

Business lending is a market that has been traditionally dominated by banks. But some warn that tech giants like Google and Amazon could be set to disrupt it.

A number of fintech start-ups have already set their sights on the business lending market, with firms like LendingClub and Funding Circle offering peer-to-peer lending platforms.

Last month, digital invoice finance platform MarketInvoice said it would offer business loans for the first time.