Girl in a Forest

You deserve better.

Small Business Borrowers’ Bill of Rights

At Funding Circle, we believe small businesses deserve better. They are the growth engine of our economy and deserve access to fast and affordable financing. This is why we built Funding Circle—to provide small business owners with an efficient and transparent way to fulfill their growing capital needs, and to understand the total cost of their loan.

Our mission is to build a better financial world, and we are proud to partner with industry leaders to set the first-ever gold standard for responsible business lending. Together, we believe small businesses have:

The right to transparent pricing and terms

You have a right to see the cost and terms of any financing you are offered in writing and in a form that is clear, complete, and easy to compare with other options, so that you can make the best decision for your business.

Learn more


What this means for lenders and brokers:

  • Transparent Rate - Disclose an annualized interest rate or APR.
  • 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 Comparison - 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.





The right to non-abusive products

Recommended reads

From real time cash flow to Yelp reviews, have you ever wondered what online lenders actually look for?

Read more

Debt can be a good thing—if it helps your business grow. Learn how to discover hidden fees, calculate mysterious rates, and select a lender who’s on your side.

Read more

You have a right to loan products that will not trap you in expensive cycles of re-borrowing. Lenders’ profitability should come from your success, not from your failure to repay the loan according to its original terms.

Learn more


What this means for lenders and brokers:

  • Transparent Rate - Disclose an annualized interest rate or APR.
  • 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 Comparison - 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.





The right to responsible underwriting

You have a right to work with lenders who will set you up for success, not failure. High loss rates should not be accepted by lenders simply as a cost of business to be passed on to you in the form of high rates or fees.

Learn more


What this means for lenders:

  • Believe in the Borrower - Offer financing only with high confidence that the borrower can repay its entire debt burden without defaulting or re-borrowing.
  • Alignment of Interests - Lenders who receive repayment from directly the borrower’s gross sales must also verify, through documents, data from third parties, and/or due diligence, that the borrower can repay all indebtedness and remain profitable, or that it has a credible path to profitability. Lenders must not rely on an ability to be paid, regardless of the borrower’s profitability, to make loans that the borrower cannot afford.
  • Right-sized Financing - Size loans to meet the borrower’s need, rather than to maximize the lender’s or broker’s revenue. Seek to offer the borrower the size of loan that they need, rather than offering the maximum amount they qualify for.
  • Responsible Credit Reporting - Report loan repayment information to major credit bureaus and consult the borrower’s credit data when underwriting a loan. Such reporting enables other lenders to responsibly underwrite the borrower and helps the borrower build a credit profile that may facilitate access to more affordable loans in the future. Lenders must inform the borrower and any guarantors if they intend to report loan repayment performance to guarantors’ credit bureaus only in certain circumstances, such as after a default.





The right to inclusive credit access

Tired of juggling multiple bills, due dates, and interest rates? Learn how refinancing your debt with a term loan could save you money in the long run.

Read more

Do you know your rights? At Funding Circle, we believe small businesses deserve better. Here are five ways to tell if your lender has your best interests at heart.

Read more

You have a right to fair and equal treatment when seeking a loan.

Learn more


What this means for lenders:

  • Fair Treatment - Abide by the spirit of the Fair Debt Collections and Practices Act and provide borrowers similar protections as described in that Act.
  • Responsible Oversight - Diligently vet and oversee the collections practices of third-party collectors and debt buyers. Do not work with collectors or debt buyers who fail to treat borrowers fairly.
  • Accurate Information - Transmit accurate, current, and complete information about the loan to third-party collectors and debt buyers.





The right to fair collection practices

If you are unable to repay a loan, you have a right to be treated fairly and respectfully throughout the collections process. Collections on defaulted loans should not be used by lenders as a primary source of repayment.

Learn more


What this means for lenders:

  • Fair Treatment - Abide by the spirit of the Fair Debt Collections and Practices Act and provide borrowers similar protections as described in that Act.
  • Responsible Oversight - Diligently vet and oversee the collections practices of third-party collectors and debt buyers. Do not work with collectors or debt buyers who fail to treat borrowers fairly.
  • Accurate Information - Transmit accurate, current, and complete information about the loan to third-party collectors and debt buyers.





*Terms used such as “lending,” “loan,” “borrower,” are intended to be interpreted broadly and apply equally to financing products not legally structured as loans, such as cash advances. “Lender” is used to include cash advance providers as well as online credit marketplaces that facilitate financing on behalf of lenders.

We invite the entire small business financing industry to join us in upholding these rights.
To learn more, please visit www.borrowersbillofrights.org.

Download your guide to business loans. See how we compare to other lenders.

What could your business do with $500,000?

Cart0

More

caall-removebg-preview.png

Connect

Community

  • Facebook
  • YouTube
  • Twitter
  • LinkedIn
Copyright © Lends Well 2021. All rights reserved.

1 Lends Well may partner with other lenders to provide a full range of loan options to qualified borrowers. Approval and funding times may vary between lending partners.