FundKite Moves Beyond Business Financing With Its Launch of a Merchant Services Division

FundKite, a fintech that provides financing to small and medium-size businesses, has broadened its services with the launch of a payment-processing division. The move will enable FundKite to expand its services beyond offering capital to merchants by providing them with a one-stop processing and financing shop, the company says.

In addition to offering merchants credit and debit card processing, FundKite will support automated clearing house payments, direct bank transfers, and digital wallets such as Apple Pay, Google Pay, and Samsung Pay, as well as contactless payments and electronic check processing through its check-guarantee service. 

“By integrating merchant services with our financial solutions, we can better support SMBs facing economic challenges, thereby enhancing our value proposition and strengthening client relationships,” FundKite chief executive Alex Shvarts says by email. “This move boosts FundKite’s business by diversifying our product suite and attracting a broader range of clients looking for comprehensive financial and payment processing solutions.”

To differentiate itself, FundKite will offer merchants options to lower their card-acceptance costs through surcharging and dual pricing. Surcharging allows merchants to add a fee that covers the cost of card acceptance to the transaction, while dual pricing enables merchants to present consumers with a cash price and a separate credit card price. Providing options can lower processing fees between 10% and 20%, the company says.

In addition to payment processing, FundKite will continue to provide small and medium-size businesses financing in exchange for a percentage of their future credit card sales. Merchants repay the loan using a percentage of their daily card-based sales. FundKite, which works with more than 200,000 businesses in the United States, provides small and medium-size businesses up to $2 million in working capital.

“These solutions are integrated with our merchant services, providing a holistic approach to managing cash flow and working capital for small businesses,” Shvarts says.