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An Online Lender `Disrupting' Banks? More Like Helping Out

  • Lending startup Fundation enters pact with more than 200 banks
  • Program aims to reduce `friction' in small-business lending
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More than 200 U.S. banks are finding not every financial-technology startup is out to steal their business.

Fundation, an online lender founded 2011, announced a partnership Tuesday with BancAlliance, a network of community banks spanning 40 states. The deal has two parts: Banks get access to a Fundation platform that simplifies underwriting for small-business loans. Fundation, in turn, can offer credit to customers that don’t fit the banks’ borrowing criteria.