Toronto-based FinTech startup Float has launched a new product for Canadian small and medium-sized businesses (SMBs) called Float Yield.
Float Yield “signals a strategic leap forward” for the company’s platform, according to Float co-founder and CEO Rob Khazzam.
Float claims this high-yield offering pays businesses four percent—up to 2.7 times the interest rates on their cash balances compared to traditional banks, and allows SMBs to earn these rates on both CAD and USD funds. According to Float, a typical SMB with a $250,000 cash balance with Float Yield has the potential to earn up to $10,000 annually through the new product.
The launch of this offering comes as some FinTech firms have pulled back their SMB products amid current economic conditions. Toronto-based Caary Capital recently lowered credit limits for SMBs, while United States-based Jeeves has elected to stop offering lines of credit under $10,000 USD, and fellow American firm Brex decided to not work with companies that did not have “professional funding” last year.
According to Float co-founder and CEO Rob Khazzam, Float Yield “signals a strategic leap forward” for the company’s platform as Canada’s SMBs struggle with inflation.
“Float Yield is another step forward on our path to create new financial opportunities for Canadian businesses,” Khazzam said in a statement. “We believe that by offering leading interest rates without the bureaucracy and fees of traditional financial institutions, Float not only enables businesses to control their spending but also earn attractive returns on their cash.”
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Float sells an all-in-one corporate card and expense management software solution designed to help Canadian SMBs track and control their spending more easily. The company currently serves thousands of SMBs across the country with its business finance platform, facilitating over 200,000 monthly transactions for firms ranging from startups to established firms. Some of its clients include Neo Financial, Klue, and Knix Wear.
To date, Float has experienced rapid growth catering to SMBs, which Khazzam has attributed to the company filling a gap created by the complacency of big banks. From its Series A round in November 2021 to October 2022, Float saw its revenue and payments volume quadruple.
Disclosure: Float has been a recent and ongoing advertiser on BetaKit.
Feature image courtesy of Float