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Medallion Financial Group is a specialty lender that started with the ultimate cash business as its customer base: yellow cabs.
Beginning this month, the Manhattan company is joining a flood of lenders looking for clients that are owed money. The firm has opened an asset-based lending arm, which uses accounts receivable as collateral for loans to companies having cash-flow problems.
"Medallion wants to be a complete lender to small businesses," says Gerald Grossman, president of Medallion Business Credit, the new lending arm. "We want to spread the financial products and empire so we're not relying totally on the medallion business."
Asset-based lending is a growing field, and New York has always been a center for the sector -- as well as the related field of factoring, in which the lender buys the invoices and becomes responsible for collecting the money owed. The Commercial Finance Association says asset-based lending reached $205 billion in...