Marqeta and OakNorth Team to Offer SMBs Commercial Cards

Card issuing platform Marqeta has launched a partnership with U.K.-based, entrepreneur-focused digital bank OakNorth.

The collaboration will see Marqeta offer a commercial card for OakNorth’s business banking clients, with the Marqeta platform giving these customers a better view of the finances, the companies said in a news release Wednesday (April 24).

“Traditional banking products aren’t always a fit for the specific needs of small- and medium-sized businesses, lacking the flexibility that they need in pivotal periods of growth and expecting them to fit into a one-size-fits-all solution,” Todd Pollak, Marqeta’s chief revenue officer, said in the release. 

“OakNorth Bank knows the complexities facing SMEs [small- to medium-sized enterprises] today, and by partnering with Marqeta, will be able to provide their customers with commercial cards with customisable controls that help to limit spending and give customers a full view of expenses, along with tools to help them invest more in their business,” he added. 

The companies noted that small- tp medium-sized businesses (SMBs) in the U.K. are struggling, with costs considerably higher than last year. The release also pointed to estimates from the Bank of England showing a 22 billion pound ($27.4 billion) SMB funding gap in Great Britain.

Research by PYMNTS Intelligence shows that these issues aren’t just confined to one side of the Atlantic. 

“SMB Borrowing Dynamics: Trends, Tools and Decision Drivers,” a report conducted in collaboration with U.S. Bank, found that many of these smaller businesses were avoiding lenders altogether, citing — among other things — steep borrowing costs.

The research found that 20% of businesses making less than $1 million per year declined to borrow at all in the 12 months prior to being surveyed. That’s compared to a 5% rate for SMBs making at least $1 million but less than $10 million, and about 3% of high-revenue SMBs (businesses that took in at least $10 million).

“And the cost of borrowing was only one concern,” PYMNTS wrote recently. “Ten percent of middle-revenue SMBs also said they preferred not to take on any additional debt last year, which was also a motivator for 18% of low-revenue companies.”

Marqeta’s partnership with OakNorth comes days after the company announced it was expanding its earned wage access program with help from financial wellness provider Rain.

“Over 60% of Americans are living paycheck-to-paycheck and seeking ways to take control of their finances,” the companies said in an April 18 news release. “Offering employees quicker access to their hard-earned wages enables employees to reduce their reliance on credit, pay their bills on time, and better manage their finances, helping to foster a more engaged and dedicated workforce.”