Business financial platform Tide has launched a ‘Credit Builder’ product to help SMEs build up their Experian credit score and make it easier to borrow money from financial institutions to support future growth.
Tide said it had introduced the new service after finding that around 87% of its small business owners have a credit score below 80.
The Tide Credit Builder works by giving its small business customers a micro ‘reverse loan’ of £240, with the business then making ‘repayments’ of around £23 per month to Tide.
Once 12 monthly payments have been made, the business will receive £240 back.
“As we emerge from the Covid-19 pandemic, small businesses are working hard to get back on their feet and make up for the toughest year and a half they have seen,” said Amit Kahana, VP of Tide Credit Services.
“Investing in growth is high on the list of priorities for many of these businesses but a poor or non-existent credit score is often a barrier to accessing credit options.
“We hope that by offering a simple way for businesses to boost their credit score they will see a wider array of credit products opening up to them, helping to fuel sustainable growth.”
The new offering has been developed with the support of Experian, which Tide CEO Oliver Prill said will provide its members, which tend to be relatively new businesses, “with the ability to build the credit history so vital to provide them with funding in the future”.
Tide recently announced its entry into India, where it intends to create more than 1,000 new jobs.