PayPal Holdings on Thursday announced the acquisition of Swift Financial to expand its offering of short-term loans to small businesses.
PayPal said the acquisition is to increase small business owners access to capital -- with loans of up to $500,000 -- and better provide credit to merchants who aren't yet using its services.
Since 2013, under its PayPal Working Capital unit, PayPal has made more than $3 billion of loans at up to $125,000 each to 115,000 small businesses. PayPal uses data from payment processing to assess a small business' credit worthiness.
Terms of the deal weren't disclosed.
"We know and value Swift's technology platform and people, and we believe their talent and capabilities will further strengthen our overall merchant value proposition," wrote PayPal in a statement on the acquisition. "Building upon an existing commercial relationship, the acquisition of Swift Financial will enable us to better serve small businesses by enhancing our underwriting capabilities to provide access to affordable business financing solutions to more businesses to help them grow and thrive."
PayPal said the Swift acquisition is expected to close later in the year "subject to certain closing conditions, including the expiration or early termination of the applicable pre-merger waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976."
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