September 21, 2026

Bob Coleman
Founder & Publisher

Main Street Monday: OnDeck Charge-Offs Running at 18.8% Annualized on Term Loans, 20.6% on Credit Lines

OnDeck’s small business term loan charge-offs are running at an 18.8% annualized pace through July. Credit-line charge-offs are running at 20.6% annualized.

OnDeck charged off $173.4 million in term loans during the first seven months of 2026 against an average unpaid principal balance of $1.58 billion.

The full-year term loan charge-off rate was 16.92% in 2025, 17.53% in 2024 and 18.03% in 2023.

Credit-line charge-offs reached $120.7 million through July, already exceeding the $113.8 million reported for all of 2025. The seven-month rate of 12.01% annualizes to 20.6%, compared with a full-year rate of 15.97% in 2025 and 14.65% in 2024.

Then there is what the borrower pays.

OnDeck reports an average 53.2% APR on term loans and 59.8% on lines of credit originated during the first half of 2026. OnDeck’s average loan size is $103,000.

Now look at what OnDeck pays to fund the loans.

Enova, OnDeck’s parent, is preparing a roughly $500 million securitization backed by OnDeck small business loans. The securities range from a 5.61% coupon on the AA-rated Class A notes to 8.28% on the BB-rated Class D notes. The weighted average coupon is about 6.2%.

Enova just walked away from becoming a bank. On September 14, it withdrew its OCC and Federal Reserve applications to acquire Grasshopper Bancorp. Enova’s CEO Steve Cunningham said regulators lack clear standards for nonbanks seeking to become banks, leaving the process open to political pressure.

Enova shares declined 23.47% on September 15, the same day the OnDeck loan-performance 8-K was filed.

The Grasshopper acquisition would have given Enova access to bank deposits. Without deposits, the ABS market remains a critical source of funding for OnDeck.