A collaboration between the UK’s main alternative business funders has been launched with a mission to make borrowing easier for the country’s SMEs.
Seven of the country’s major alternative funders have set in motion a web portal – alternativebusinessfunding.co.uk – designed to signpost SMEs to the most appropriate source of non-bank funding.
The portal will provide a short-cut to finance options that business owners may not be fully aware of and each organisation will “recycle” their rejected applicants to the site to access other potential non-bank funding sources.
The alternative business funders – CrowdCube, Funding Circle, Market Invoice, Platform Black, Seedrs, Zopa and Pensionledfunding.com – account for 85% of the alternative non-bank funding market and have provided to date more than £580m to SMEs, supporting around 80,000 jobs.
The new portal is the starting point of a campaign to create a more collaborative environment for business funding, aimed at simplifying SME owners’ search for finance to help support their businesses, while providing a place for the major banks to redirect customers who don’t meet their criteria. This will be a much-needed boost after the latest Bank of England figures showed a further drop of £0.3bn in small business lending in January this year.
Matthew Fell, CBI director for Competitive Markets, said: “There are lots of innovative alternative finance products on the market in the UK for growing firms but the simple fact is that most businesses aren’t aware of what’s available, or how to get hold of it.
“So it’s really encouraging to see some of the leading providers getting together to raise awareness of their products by launching a new one-stop-shop website.”
James Meekings, co-founder of Funding Circle, the online marketplace for business loans, added: “All of the platforms involved in the portal are determined to significantly enhance the availability, clarity and quality of new finance solutions to both small businesses and major banks wanting to refer unsuccessful applicants.
“This forms part of our wider commitment to providing fair, fast and transparent access to finance to as many small businesses as possible.”