Did you know there are over 30 million small-to-medium-sized businesses in the U.S. with approximately $425 billion in total outstanding loans? That sounds like plenty of opportunities for lenders to loan money, but it's harder than it seems to link up a borrower to a lender.
The Citi Commercial Bank team, through Citi's D10x program, spotted this gap and created a platform, Bridge built by Citi, to address it. The platform provides a digital meeting place that allows small-to-medium-sized businesses to connect with various regional, local, and community banks for loans up to $10 million. The development and launch of Bridge built by Citi is part of Citi's long-standing commitment to inclusive access to capital and support of innovative, digital-first solutions to financial services.
Launched on August 10, Bridge by Citi already has one-third of all Black-owned banks signed onto the platform. With minimal marketing spend, Bridge has already received over 6,000 unique visitors to the site and had 275 borrowers complete the registration process. So far, eight borrower's requests-for-proposals have received responses from banks, with two of those borrowers having already selected a bank that will handle their transaction. Starting in mid-September, Citi will begin ramping up their spending on marketing in order to increase the platform's reach.
"Citi prides itself on encouraging a spirit of entrepreneurship amongst its employees to solve financial access issues and improve digital offerings for our clients and community partners," explained Vanessa Colella, Citi's Chief Innovation Officer. "The development and launch of the Bridge built by Citi platform is a great example of the power of innovation that comes from within a global institution like Citi and our ability to build a service that has the potential to change the future of business lending." Led by Rohit Mathur and Harte Thompson, Bridge is completely Citi built combining teams across the bank from Citi Commercial Bank, Citi Ventures, ICG Technology, BCMA, Legal, GPA and various control and risk partners.
This platform is advantageous to businesses seeking loans because it replaces the time-consuming manual process of submitting loan requests bank by bank. On the other side, local and regional banks, have limited access to the businesses who may be seeking loans and lack digital prospecting tools. While many local and regional lenders will admit that they wish there was a more seamless process from their end, these banks typically don't have the ability to build technology solutions to compete with FinTechs or marketing budgets to create brand awareness and compete with large commercial banks.
By connecting borrowers with more lenders, the platform empowers small businesses with access, choice and convenience―and access to capital to grow their businesses. Lenders, meanwhile, can expand their reach beyond their local markets and offer their clients the seamless, high-quality user experience found in modern fintech solutions. The Bridge built by Citi platform will initially include 18 banks, including six minority depository institutions, and will be available to businesses through a pilot program across the Southeast and Rockies region, including Alabama, Colorado, Georgia, Louisiana, North Carolina, South Carolina and Tennessee.
Bridge built by Citi will also create an opportunity to engage with Minority Depository Institutions (MDIs) along with other local banks to help drive new business and revenue to their local institutions via the platform. This is in line with Citi's Action for Racial Equity commitment, which is focused on helping close the racial wealth gap and increase economic mobility in the U.S.
"Citi has been a great partner to Optus Bank as we look to grow our customer base and continue to extend loans to small businesses," stated Dominik Mjartan, President and Chief Executive Officer of Optus Bank. "Bridge built by Citi will enable us to deploy the capital we've raised from Citi and others back to more entrepreneurs – jumpstarting the desperately needed revitalization after this pandemic ravaged many neighborhoods, particularly those in underbanked communities."
"Citi believes in the power of local, small businesses and continues to find ways to support businesses that make up the foundation of communities across the U.S. For example, Citi funded loans totaling in excess of $5.1 billion as part of the Small Business Administration's Paycheck Protection Program during 2020 and 2021," shared Richard Banziger, Head of Citi's U.S. Commercial Bank. "As both a lender and a community stakeholder, we have deep expertise and understanding of the problems businesses face when trying to navigate the borrowing process. We are committed to finding digital solutions that can make the process easier, more seamless and more equitable."
To learn more about the initiative please visit www.bridgebuiltbyciti.com or reach out to Rohit Mathur or Harte Thompson.
Black Enterprise article highlighting Bridge Built by Citi here.