U.K. tech firms marry lending, billing engines to expand small business credit
U.K.-based small business lender Capital on Tap has partnered with small business software provider Receipt Bank to launch a new credit card with access to credit lines of up to £50,000 (about $62,500).
The partnership leverages Receipt Bank’s software that automates receipt and invoice data capture, combined with Capital on Tap’s lending program.
The Capital on Tap lending program is issued as a credit line that is spent through a credit card which does not charge foreign exchange fees. The partnership will also leverage Receipt Bank’s integration with the small business accounting software platform Xero.
One advantage of the partnership is that by using Receipt Bank’ software, the partnership can facilitate receipt tracking, and apply the correct VAT codes to help businesses optimize tax refunds.
According to Crunchbase, a website that tracks investments in private technology startups, Capital on Tap has raised £140 million (about U.S. $ 175 million) in debt financing in a single round last year. Among the five investors are Citibank and TriplePoint Venture Growth; the latter company also invested in cross-border payments specialist World Remit.
Capital on Tap reports it has more than 50,000 small business clients and has delivered more than £500 million (about $625 million) in capital since its founding in 2012. It offers fixed weekly loans to revolving monthly credit lines and issues both Mastercard and Visa cards.
London-based Receipt Bank has raised $65 million in five funding rounds since 2015, according to Crunchbase. Its most recent round, a Series B, raised $50 million, from New York venture capital firm Insight Partners.
Capital on Tap currently offers credit cards to small business that offer up to 56 days interest free on credit card purchases. The base card has no annual fee, but the cards that offer cash back or British Airways reward points called Avios do charge fees ranging from £99 (about $125) to £249 (about $310) per year.
The new Receipt Bank credit card will have the same 56 days interest-free period as other Capital on Tap cards and will also offer 0.5% cash-back rewards.