Facebook recently decided to buy outstanding invoices from businesses owned by women and minorities. The way it works is the business sells an outstanding invoice to Facebook, then Facebook has the debtor pay them what is owed. In return for this, the business pays Facebook 1% of the value of the invoice.

There is a catch– the invoices have to be “eligible.” Invoices must have a minimum value of $1,000 and the customers must have an investment-grade rating. In other words, the invoices ARE going to be paid, making this a no risk endeavor for FB.

Businesses eligible for this program must be certified by an approved partner organization as majority-owned, operated and controlled by racial or ethnic minorities, women, U.S. military veterans, LGBTQ+ people or individuals with disabilities. This makes FB look “woke,” but what is happening here is that they are taking advantage of gullible small business owners.

In other words, Facebook is making no risk loans at a rate that varies from 4% to 12% APR to gullible companies and making itself appear to be “woke.” I wonder how many people will think that FB is doing people a favor.

Categories: economics


it's just Boris · September 13, 2021 at 7:33 am

This seems pretty far afield from Facebook’s normal business model. I wonder what’s driving them to start doing this? Perhaps they intend to use it to drive demand for their nascent cryptocurrency in some fashion. Use FaceBucks (or whatever. It’s on at least name #2 now) and they’ll waive the 1% fee … or start charging a lower fee if the customer does not use their currency.

And – stupid question – does Facebook have all the regulatory paperwork in place to start acting as a financial company?

    it's just Boris · September 13, 2021 at 7:34 am

    Edit – will charge a higher fee if the customer doesn’t accept their crypto. Pre-coffee…

Don Curton · September 13, 2021 at 7:52 am

So basically Facebook is just offering a Pay Day Loan service nationwide to selected persons. At a slightly reduced rate from what most pay day loan businesses charge.

Wouldn’t all the laws against discrimination apply here if a white man running a small business applied for the same service and was rejected?

And do the woke people at Facebook even realize that a lot of the small businesses supposedly run by their special people are actually started and run by white men who were smart enough to list their wives (or minority friend, or whatever) as the owner on paper? Just to get them in the door for govt contracts and around crap like this?

    Divemedic · September 13, 2021 at 7:58 am

    Yeah. I own 4 companies. The largest of them has my wife as the majority shareholder. My brother did the same, so he would get preference in government contracts.

Chimp Sackless · September 13, 2021 at 11:09 am

Sounds like jewish math

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