New online marketplace for SMEs launched
(24 August 2010 – UK) A new online lending marketplace for small businesses has launched in the UK, enabling lenders and savers to bypass banks.
With the top four high street banks making up 92 percent of small business lending in the UK, according to HM Treasury, coupled with accusations that they are failing to lend to the small business sector, Funding Circle has said it provides an alternative that offers enterprises and savers a better deal.
Funding circle claims that through the site lenders will have the ability to earn an average of six to nine percent at the same time as reducing risk by lending smaller amounts to a wide variety of creditworthy small businesses.
While there are no restrictions to the amount a lender can lend overall, participants can only provide up to £2,000 (A$3,482) per small business and can determine the interest rate the funds are lent at as well as the criteria the business must comply with or can outright individually hand pick businesses.
The lowest interest rate offers become part of the loan through an online auction process.
Laurie Edmans, chairman, Funding Circle, said that loans made through Funding Circle earn a high rate of interest, and can be sold to other lenders so people can access their money at any time.
In providing a loan, investors are also helping small businesses, many of whom feel let down by the banks, Mr Edmans added.
Funding circle claims that through the site lenders will have the ability to earn an average of six to nine percent at the same time as reducing risk by lending smaller amounts to a wide variety of creditworthy small businesses.
While there are no restrictions to the amount a lender can lend overall, participants can only provide up to £2,000 (A$3,482) per small business and can determine the interest rate the funds are lent at as well as the criteria the business must comply with or can outright individually hand pick businesses.
The lowest interest rate offers become part of the loan through an online auction process.
Laurie Edmans, chairman, Funding Circle, said that loans made through Funding Circle earn a high rate of interest, and can be sold to other lenders so people can access their money at any time.
In providing a loan, investors are also helping small businesses, many of whom feel let down by the banks, Mr Edmans added.
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