This announcement was posted in Finextra and illustrates another of the growing credit-as-a-service iterations that are available for businesses, particularly in the SME space. In this case, Capital One has entered into an agreement to acquire BlueTarp (terms not disclosed) so that they have added tools to service their card partnership clients.
“BlueTarp delivers customized business-to-business credit management programs to merchants and small- to medium-sized companies. It allows for a seamless purchase-to-payment process featuring a combination of accounts receivable management tools, cash flow and risk protection, with optional collections and customer support. These programs will provide additional servicing capabilities and broader financial offerings for Capital One’s co-brand and private-label credit card partnerships clients.”
We have been calling out the convergence of procure-to-pay solutions now for some time, and although the trend has been mostly integration and partnership effort between fintechs, bank to fintech collaboration in the space is now clearly on the radar. In this particular case BlueTarp offers suppliers credit management services that essentially offload the need for suppliers to manage receivables. We have not spoken to Cap One or BlueTarp, but the description sounds like factoring services. The company also distributes through buyers who wish to extend DPO with participating suppliers, along with providing tracking and flexible payments options.
“BlueTarp’s clients include national and regional business-to-business suppliers across a variety of industries including office supplies, hardware, home building, building materials, lumber and supplies, tools and equipment and many more. Founded in 1999, BlueTarp was founded to give building material suppliers a superior credit program that delivers cash flow so that they could invest in their business and grow sales while protecting themselves from risk.”
There is no lack of tech and business solutions for SMEs in this era of fast moving innovation, and as Capital One continues expanding its B2B ambitions, we see one way that bank-fintech collaboration can lead the way.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group