Sam’s Club Testing Online Small Business Loan Program

As a way to offer support for the small businesses among its membership, Sam’s Club is piloting an online program with Superior Financial Group, (SFG) the nation’s top Small Business Administration (SBA) lender, which would make $5,000 to $25,000 loans to eligible members. According to November 2009 state of small business survey conducted by Sam’s Club, almost 15 percent of its business members said they’d been denied a loan to run their operations, a 3 percent increase from April 2009.

The first-of-its-kind program will complement such other small-business offerings as low-rate merchant credit card processing, convenient order-ahead programs and early shopping hours.

Sam’s Club’s pilot will concentrate on aiding Main Street minority-, women- and veteran-owned small business owners, in addition to micro-entrepreneurs, with SBA’s Premier Outreach Express products, including Community Express, Patriot Express and Export Express loans.

“Access to capital is a major pain point for our members and the small business Main Street community,” noted Catherine Corley, VP, membership at Sam’s Club, a division of Bentonville, Ark.-based Wal-Mart Stores, Inc. “We believe this pilot program is a step in the right direction to help fuel small business growth and create jobs to stimulate our economy. It’s also simple to apply and costs less, which is consistent with our goal to help our members make smart choices and provide superior value.”

One of just 13 approved Small Business Lending Corporations (SBLC) federally regulated by the SBA, Superior Financial Group specializes in providing access to credit for Main Street and underserved borrowers. The Walnut Creek, Calif.-based lender also provides free online technical assistance and online training courses that specifically address the borrower’s weaknesses. The courses even show how to write a business plan through a business plan-writing template.

“All lenders are trying to make an impact on Main Street, which includes minorities, women and veterans to help create jobs,” said SFG CEO Tim Jochner. “Main Street, however, remains the most difficult underserved market to reach. Sam’s Club, together with SBA’s Premier Outreach Express loan programs, provide[s] both a unique and powerful opportunity to reach and provide capital along with technical assistance and training to increase successful penetration into this underserved space.”

Sam’s Club members that apply for a small business loan online during the pilot will get $100 off the application fee, a 20 percent discount and a 7.5 APR, which is a 25-basis-point discount. The terms of the loans will remain at 10 years, which is common to help keep monthly payments low. There’s no penalty for early repayment. Sam’s Club business memberships cost $35 annually.

While most of the Sam’s Club small business loan pilot program will take place online, the division will test some aspects of the initiative in club communication and other marketing efforts to reach business members and small business owners. Business members interested in learning more can visit samsclub.com and click on the services tab.

Sam’s Club serves over 47 million U.S. members with locations nationwide, as well as in Brazil, China, Mexico and Puerto Rico.