Tearsheet publishes its bi-weekly newsletter Lending, underlining the important moves and stories in digital lending. Subscribe here.
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The cannabis industry wants traditional lenders
The cannabis industry desperately wants traditional lending options.
- The cannabis market is set to double to $41.5 billion by 2025.
- Federal illegality limits financing options for cannabis businesses andforces owners to dilute their equity in return for investment.
- Cannabis business owner: "A lot of companies...have given up so much equity that they’re a minor stakeholder."
- Other challenges include no low-cost lines of credit and no working capital lines.
- Fintech cannabis lender Bespoke Financial brings traditional lending to cannabis businesses looking to scale their operations.
- Bespoke recently closed $8 million in Series A funding, bringing the company’s total funding to over $28 million.
- Silver Lining: House of Representatives passed the SAFE Banking Act in April 2021. If passed in the Senate, the act would prevent federal regulators from penalizing FIs for providing services in the cannabis industry.
- Until then, Bespoke's CEO says: "We’re still sitting in a situation where the industry is operating with both hands tied behind its back."
What we're reading
Digital lending platform market revenue is set to cross $20 billion by 2027 (PR Newswire)
China keeps lending benchmark rate unchanged for 13th straight month (Reuters)
Sezzle now features Ally Lending's financing solutions on itsplatform (PYMNTS)
eBay launches embedded lending for UK-based SMBs (Business Insider)
Brace Yourself for the ‘Bank of Amazon’ (It’s Coming … Someday) (The Financial Brand)
Top 5 consumer lending apps (PYMNTS)
Justice Department probing Kabbage, fintechs over PPP loan calculations (Reuters)
Experian rolls out new commercial suite to help business lenders mitigate risk (Business Wire)
Why banking providers should offer credit builder loans (The Financial Brand)
Small business owners missed out on thousands of dollars in loans when PPP funding ran out early (CNBC)
5 trends in lending for 2021 (GDS Link)