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Small businesses use B2B BNPL to increase growth and stability

Since the Covid-19 lockdowns, companies have downsized, leaving many unemployed. B2B BNPL can help these people start small businesses and scale them up faster. It also gives them a solid foundation in an uncertain market. It will ensure that the recession leads to the rapid growth of new businesses and industries.

Small businesses tend to rely on personal capital. It is understandable, as they usually cannot receive traditional loans. Even when they do, interest rates are at an all-time high. Additionally, credit card interests are also on the rise. Thus, businesses invest on a small budget, which prevents scalability. It avoids the risk of significant losses but also prevents growth.

Ronak Shah is the CEO and Co-founder of Obvi. He told journalists at PYMNTS that small capitals are insufficient for businesses. They prevent growth. It is challenging to turn a small company into an established one. A flexible financing tool, like B2B BNPL, will make this transition smoother.

Stoyan Kenderov is the COO of Plastiq. He and Shah stated that a BNPL is beneficial because it is popular among consumers and clients. Thus, it will be easier to use. Specialized loans for B2B will be easier to handle than traditional debts. These loans are possible because of the data that a BNPL gathers.

Shah and Kenderov are confident that the B2B BNPL loans will help small businesses. They can focus on different growth aspects. Instead of focusing on a small capital for buying and selling, they can look at more options. It includes marketing, collecting consumer insights, and more.

Kenderov detailed the differences between how companies and individual consumers use BNPL. A customer wants short payments over a long period. It is because they are confident that their income is stable. They can afford impulse purchases. But businesses have more responsibility. They prefer shorter loan periods. It helps them keep the financial processes streamlined.

Kenderov reassures businesses that B2B BNPL is secure. There have been no significant attacks. BNPL is at risk of stricter policies for customers. But small, quick loans are standard on the businesses’ side. Thus, the adoption of these systems will be fast and efficient.

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