American Express Steps Up Small Business Lending

October 17, 2017         By: Steven Anderson

American Express’ role as a mobile payments provider—one of the bigger ones, yet often an also-ran alongside Visa and Mastercard—has been a bit tenuous over the last few years. It’s looking to change that, though, by stepping up its suite of services. A new report suggest that it’s targeting the small business market a little harder by offering up an array of financing products.

The word from American Express says that small businesses—and even some medium-sized ones too—can now get in on a string of new options for working capital and short-term loans. Businesses will be able to get access to up to $50,000, which can be used to either consolidate debt or expand the business.

Further word came from American Express’ general manager and senior vice president of global commercial financing, Gina Taylor Cotter, who noted that this was a move to take advantage of the current small business climate, which was generally optimistic enough to make comparatively small loans an option.

Cotter further noted “Our research shows that nearly three-quarters, 74 percent, of small businesses have a positive view of the economy, and more than half, 57 percent, have plans to make capital investments. Small businesses need access to capital with an easy application process and at competitive rates. We designed Business Loans to help address this need for smaller, general purpose loans that can help businesses make critical equipment purchases or renovations to keep up with growing demand, or consolidate business debt to help with cash flow.”

Not a bad idea, but if American Express really wanted to clean up, it would consider stepping up factoring service instead. For those not familiar, factoring for small businesses is basically a way to sell invoices to a larger firm, and then allow that larger firm to pursue the debt owed accordingly. Sometimes, small businesses can have a tough time collecting on that debt, and offering that service might make it a hero of small business.

Still, as it sits, American Express is clearly working hard to make its case to small business. If it can win friends and influence businesses here, it can move them into the rest of its product line, and potentially net their mobile payments business as well.