- 1Merchants are seeking fewer and smaller loans; lenders are offering less at higher rates.
- 2CEO Scott Peyree expects the slowdown to be short-term.
- 3SMB segment revenue rose 49% year over year.
LendingTree is seeing a modest cooling in small business lending, CEO Scott Peyree said, as geopolitical turmoil and higher gas prices weigh on merchants.
"When the war started in March and gas prices went way up, that was a shock to the system in that month specifically," Peyree said. On the small business side, he described "a little bit of both": fewer small merchants looking for loans and smaller loan sizes than normal. Credit remains available, he said, but lenders are typically offering lower amounts at higher interest rates.
A cautious borrower
Peyree argued that the combination is dampening urgency. A merchant who is already cautious and then cannot get the exact loan they want, at a higher rate, is less eager to borrow, he said, citing broader geopolitical uncertainty. He expects the pullback to resolve itself once consumer sentiment recovers and geopolitical conditions settle.
Revenue still growing
Even so, revenue from LendingTree's small business segment was up 49% year over year. The company has added staff to meet that demand. Its Q1 shareholder letter says it has "selectively added to our SMB concierge team" to help customers find suitable financing while speeding up application submission, approval and funding.
Source reporting: deBanked.
