Google and RBC have quietly launched Adwords Business Credit in Canada. An innovative financial product, available by invitation only, it offers a credit line to small businesses exclusively for the purposes of funding Adwords campaigns.
As an incentive to apply, new cardholders are being provided a free Nexus 7 tablet if they get approved for the card and spend $250 on the card within the first 90 days. The application is similar to most other small business credit card applications, requiring business assets and liabilities, financial information and the like. It can be underwritten by your business or yourself. The card does offer an 11.99% interest rate, which is competitive compared to other small business credit cards, but a little high when compared to other small business lines of credit.
This seems like a great product for both Google and RBC alike. For Google, it provides its customers with additional funding for their Adwords campaigns, hopefully translating into incremental advertising spend. Google has stated that the target line of credit size is 3 times the size of an advertiser’s historical monthly Adwords spend. However, they did add that line size is determined by RBC and is set at their discretion. Regardless, there is lots of upside for Google if customers dial up there Adwords spending as a result of having more ad budget. In addition, we imagine Google does not pay interchange on any spend made on the Adwords Business Credit Card. As a result Google is saving 2%+ on customers who use the Adwords business Credit Card instead of another credit card, which is not an insignificant number, even for Google.
From RBC’s perspective, this is a greater lead generator for its SME business. It seems like an ideal opportunity to gain access to a significant number of small and medium sized businesses that are spending money on growth. At this point, with the program only available by invitation, it seems RBC is pre-screening its prospects, and working through the initial kinks. We’ll see how aggressive it gets in marketing the program in the coming months.
From the SME’s perspective, this product may or may not be worth it. If the SME, or small business owner, already has a credit card and is earning points on their card, why not continue to fund their Adwords campaign on their existing rewards credit card and get some points in return, credit line allowing. That said, if your credit line is not sufficient, or you want to revolve some debt, this may be a convenient and expedient product.
All in all, we think the Adwords Business Credit card is a neat an innovative product for small business in the online world. Worth monitoring its success.