IBM has pledged $1 billion in financing to help small and mid-sized businesses (SMBs) procure certain IBM systems and services, the company announced Thursday.
"SMBs face difficulties in access to financing. They may not have the wherewithal to go get financing or credit, or they may not have time," said Ed Abrams, IBM vice president of mid-market business. "By making finance available to credit-worthy clients, we can help them fuel their business growth."
IBM is applying the loans to the purchase of 29 IBM systems and services overall, including offers for cloud services, big data and analytic systems. IBM Global Financing will handle the loan processing and paperwork. The financing incentives will be available over the next 18 months. Applicants can get approvals within 60 seconds.
The loan program is not a response to the current sluggish global economy, but rather proof that IBM is seriously pursuing the SMB market, Abrams said. The company has been boosting its marketing efforts in the SMB space over the past year, making available many technologies, such as Cognos and Netezza, that were marketed chiefly to larger organizations. U.S. SMBs will spend more than $49 billion on cloud services in 2015, according to IT analysis firm AMI Partners.
Abrams declined to discuss how large of a boost the $1 billion commitment will be over the current amount of loans IBM Global Finance manages, other than to say it is a "significant" addition.
IBM Credit LLC will provide the loans in the U.S., and various banks will provide the loans in other parts of the world. Typically, IBM Global Financing customers will repay the loans over 36 months, in either monthly or quarterly increments. The financial terms of the loans will vary according to the purchase. Loans can start with interest rates as low as 0% for 12 months, with no money down.