The firm aims to compete with alternative or private lenders who charge rates well in excess of 20%.
Lending Loop, which is Canada’s first P2P lending platform, said that it will offer small businesses a better way to borrow, with a quick and easy application, flexible repayment options and considerably lower interest rates than alternative lenders.
The platform will enable investors to lend as little as $50 to businesses.
Commenting on the launch, Lending Loop CEO Cato Pastoll said: "Today is a brand new day for Canadians and small businesses across the country. With as little as $50, Canadians can lend their money to the thriving local coffee shop that needs new equipment to grow or the farm around the corner requiring staff to develop a farm-to-home produce delivery program."
Lending Loop added that it uses an all or nothing funding model, where loans only come into effect if the borrower receives the full amount of their loan request in total pledges, in order to protect the lenders’ hard earned money.
Lending Loop was founded by entrepreneurs Cato Pastoll and Brandon Vlaar.