08 Dec Quote 2 Fund Signs Small Business ‘Borrowers’ Bill of Rights’
Business financing marketplace Quote 2 Fund has joined a small team of leaders committed to eliminating predatory lending to small businesses
December 8, 2015 – Quote 2 Fund announced that it has become a signatory to the Small Business Borrower’s Bill of Rights, a public commitment to ensure small business owners have access to funding that is both transparent and fair. By signing, Quote 2 Fund joins a coalition of industry leaders committed to promoting responsible practice in the small business lending sector.
The Small Business Borrowers’ Bill of Rights (SBBOR) is composed of lenders, credit marketplaces, and nonprofits—including Accion, Funding Circle, Lending Club, Opportunity Fund and others—who have become increasingly concerned by the high cost, lack of transparency and debt stacking that have become common among certain online lenders.
As online marketplaces provide faster and easier ways for businesses to borrow, the SBBOR works to ensure that lending processes put the rights of borrowers first by adopting the following guidelines:
- Transparent Rates – Discloses an annualized interest rate or APR (when applicable)
- No Hidden Fees – Disclose all upfront and scheduled charges.
- Plain-English Terms – Describe all key terms in an easy-to-understand manner, including the loan amount, payment amount and frequency, collateral requirements, and the cost of prepayment.
- Clear Comparisons – Present all of these pricing and other key terms clearly and prominently, in writing, to the borrower when the loan offer is summarized for the borrower and whenever a term sheet, offer summary, or equivalent is provided
“Small business borrowers have the right to see the cost and terms of any financing that they are offered in writing and in a form that is clear, complete, and easy to compare with other options,” Quote 2 Fund founder Jules Dalsey said. “Quote 2 Fund was founded on these principles, and we encourage lenders, platforms, and marketplaces to commit to the guidelines presented in the Bill of Rights as well.”
In an earlier interview with letstalkpayments.com, Quote 2 Fund’s Chief Communications Officer Hezekiah Herrera addressed concerns over brokers “…engaging in predatory practices—many times offering products that the small business borrower is unable to repay. That is an on-going problem for both traditional and alternative lenders. The good thing is that there has been some level of self-regulation in this highly unregulated sector. ”
In addition to dedicating itself to follow the SBBOR guidelines, Herrera says lenders, marketplaces, and brokers should understand that it is in “…everyone’s interest to go beyond level-setting borrowers to helping them understand the importance of credit. It is what makes the difference in attaining favorable rates, terms and approvals in general.”
Earlier this year Quote 2 Fund launched its Quolify app, in which a borrower can view and compare business financing quotes within a nationwide network of banks and lenders. There is no cost to get a quote or apply with Quote 2 Fund.