CLA teams with Navigant to offer SMART Box disclosure tool to lenders

The Canadian Lenders Association (CLA) will be collaborating with consultancy Navigant to adapt the SMART Box tool for the Canadian market. SMART box is a pricing disclosure and comparison tool that helps small businesses assess and compare debt finance options.

The tool was originally introduced in the US by the Innovative Lending Platform Association in 2016 in order to standardize pricing disclosure in small business finance. SMART Box includes clear pricing calculations and explanations to help accurately assess the costs of loan options. The tool was developed with input from small businesses, not-for-profits, policymakers, and lending platforms.

The CLA, which supports lenders who serve small businesses and individuals by ‘non-conventional or innovative means,’ will be bringing the transparency tool to Canada with the help of Navigant. The Chicago-based consultancy provides consulting, outsourcing, and technology services primarily to clients in the healthcare, energy, and financial services industries. The consulting firm has one Canadian office, located in Toronto. To help localize the tool and ensure regulatory compliance, Navigant will draw on the resources of its Financial Services Advisory and Compliance (FSAC) segment – which helps industry clients streamline compliance, manage risk, and create competitive advantage. The firm has previous experience working on the SMART Box platform in the US, where it was adopted as the calculation methodology in the US Truth in Lending Act.

 “We’re excited to work with the CLA to further expand the use of the SMART Box comparison tool to help standardize pricing metrics for small businesses in Canada,” said Christopher Sicuranza, managing director and co-lead of Navigant’s banking, insurance, and capital markets practice within FSAC. “This is a great opportunity to apply Navigant’s deep expertise in lending regulation to create a win-win both for lenders and for small businesses.”

The CLA previously announced the launch of the pricing transparency tool in October of last year, with lenders like Company Capital, IOU Financial, and Lendified pledging to adopt it. Now, it has called on the expertise of Navigant to further refine the tool for Canada, conforming it to regulatory requirements – including the annual percentage rate (APR) calculation methodology outlined in Ontario’s Consumer Protection Act, 2002.

“The CLA is looking forward to collaborating with Navigant to expand the use of SMART Box in Canada and to serve and support our growing client base,” concluded CLA president Gary Schwartz.