Business lending platforms

The market for peer-to-peer lending to businesses in the UK is larger than both the consumer and property lending markets. To give you a rough idea of quantum, the Cambridge University 5th Alternative Finance Industry Report suggested that loans totalling £2.0 billion were issued in 2017.

The market has experienced unprecedented growth from 2011 onwards, as illustrated below.

Source: Cambridge University, The 5th UK Alternative Finance Industry Report

The majority of UK-based peer-to-peer business lending platforms focus on secured lending whereby the loan is secured against an underlying asset e.g. all business assets. Strangely though, the UK’s largest business lending platform (Funding Circle) focuses exclusively on unsecured lending. There are also a number of platforms which offer a mixture of both secured and unsecured lending.

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Secured business lending platforms

There are ten UK-based peer-to-peer lending platforms solely focused on providing secured business lending:

Growth Street (launched 2014)

Growth Street provides secured working capital loans to UK businesses. Loans are secured against all underlying business assets. Learn more about the platform in our Growth Street review.

  • Target interest rates – 5.3%
  • Self-select vs. auto-investment – Auto-investment only.
  • Secondary market – No, but provided there is sufficient liquidity, you should be able to access your funds within 30 days as Growth Street loans are no longer than 30 days in length.
  • IFISA – Yes
  • Minimum investment – You can invest with Growth Street from just £10.
  • Cashback offer – £50 when you invest £1,000 (5.0%), or higher if you invest £2,000, £5,000 or £10,000. Invest via this referral link to take advantage of this offer.

Assetz Capital (launched 2012)

Assetz Capital has simplified its offering of late, and now provides secured business loans via three auto-invest accounts which vary only with regards to the notice period required to withdraw funds (Quick Access, 30 day access and 90 day access). A manual lending account remains available, offering higher interest rates of up to 12.0% on specific loans. Whilst the auto-invest accounts are covered by a provision fund, the manual lending account is not. Learn more about this platform in our Assetz Capital review.

  • Target interest rates – 4.1% – 5.75% for automatic lending accounts or up to 12.0% via a manual lending account.
  • Self-select vs. auto-investment – Platform offers both self-select and auto-investment options.
  • Secondary market – Yes, self-select loans can be sold to other investors, subject to demand. Auto-select loans can also be sold, subject to the relevant notice period and investor demand.
  • IFISA – Yes
  • Minimum investment – You can invest on Assetz Capital from just £1.
  • Cashback offer – £50 if you invest £1,000 (5.0%) via this referral link.

AblRate (launched 2012)

The ‘abl’ in AblRate is an acronym for ‘Asset backed lending’. It is a secured business lending platform, which initially focused on servicing the aircraft leasing sector, but has grown to cover a variety of different industries.

  • Target interest rates – 10.0 to 15.0%
  • Self-select vs. auto-investment – Primarily focused on self-select lending, though auto-investment options in the form of ‘portfolio’ loans have recently launched.
  • Secondary market – Yes, a secondary market exists and enables lenders to sell at a premium or discount.
  • IFISA – Yes.
  • Minimum investment – Invest from £100.
  • Cashback offer – No offer currently available.

ThinCats (launched 2011)

Thincats target UK SME’s who require business loans of £250,000 or more. In addition to loans featuring fixed interest rates, the platform occasionally lists variable rate auctions whereby lenders bid at the rate they want to receive. Once the loan amount is reached, new lenders can still pledge funds, providing they are willing to lend at a lower rate.

  • Target interest rates – 7.0 to 15.0%
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, subject to fee of 1.0% of capital outstanding.
  • IFISA – Yes.
  • Minimum investment – Invest from £1,000.
  • Cashback offer – No offer currently available.

Crowdstacker (launched 2015)

Crowdstacker is a member of the P2P Finance Association, the self-regulatory P2P lending authority. As a result, the platform is very transparent in providing quarterly statistics on on the state of the loan book. The business loans available on the platform tend to be quite sizeable as the minimum borrowing criteria is currently £1.0 million.

  • Target interest rates – 4.0 to 7.5%
  • Self-select vs. auto-investment – Self-select only.
  • Secondary market – Yes, with no fees associated.
  • IFISA – Yes.
  • Minimum investment – £500.
  • Cashback offer – No cashback offer currently available.

Folk2Folk (launched 2013)

Folk2Folk offers loans to local businesses exclusively secured against UK land or property. The key sectors targeted include agricultural businesses, construction, hospitality and tourism. The minimum investment of £20,000 per loan means that Folk2Folk is unfortunately only suitable for larger retail investors.

  • Target interest rates – Up to 9.0%
  • Self-select vs. auto-investment – Auto-investment only.
  • Secondary market – Yes, but with associated fees the greater of £250 or 0.5% of capital outstanding.
  • IFISA – Yes
  • Minimum investment – £20,000 (per loan).
  • Cashback offer – No cashback offer available.

Abundance Investment (launched 2012)

Abundance Investments key unique selling point is that it solely provides business loans for green (renewable energy, energy efficiency and waste) and social infrastructure (social/affordable homes) projects. Loans are added to the platform fairly infrequently.

  • Target interest rates – 4.5 to 15.0%
  • Self-select vs. auto-investment – Self-select only.
  • Secondary market – Yes, no fees attached.
  • IFISA – Yes.
  • Minimum investment – Invest from just £5.
  • Cashback offer – No cashback offer available.

Market Invoice (launched 2011)

Market Invoice offers both business loans and invoice financing to UK businesses. The minimum investment of £50,000 means that Market Invoice is unfortunately only suitable for larger retail investors.

  • Target interest rates – 10.0 to 12.0% for business loans, 4.0 to 6.0% for invoice financing.
  • Self-select vs. auto-investment – Auto-invest only.
  • Secondary market – No.
  • IFISA – No.
  • Minimum investment – Minimum investment of £50,000.
  • Cashback offer – No cashback offer available.

HNW Lending (launched 2014)

HNW Lending describes itself as a provider of peer-to-peer loans for high net worth individuals. Loans can be both personal (i.e. direct with the high net worth individual) or with a business entity. All loans are secured, against a range of assets such as property (UK and overseas), cars, and pensions. The directors of HNW Lending have ‘skin in the game’, taking a first loss position in all loans.

  • Target interest rates – 6.0 to 15.0%
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, subject to a 1.5% selling fee.
  • IFISA – Yes
  • Minimum investment – Minimum of £5,000.
  • Cashback offer – No cashback offer available.

Money and Co (launched 2014)

The Money and Co platform features an auction system whereby once loan funding reaches 100.0%, new lenders who have not yet invested can decide whether they would like to pledge funds at a lower interest rate to replace the lenders who had pledged at the higher interest rates. The minimum loan size considered by Money and Co is £50,000.

  • Target interest rates – 6.0 to 10.0%
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, subject to a 0.25% selling fee.
  • IFISA – Yes
  • Minimum investment – Invest from just £100.
  • Cashback offer – No cashback offer available.

Unsecured business lending platforms:

Only Funding Circle focuses exclusively on providing unsecured business loans within the UK market.

Funding Circle (launched 2010)

Funding Circle is the largest (and only listed) P2P business in the UK. The business retains membership of the P2P Finance Association, the UK’s self-regulatory body which seeks to increase transparency in the industry. Funding Circle offers unsecured loans to businesses. The platform offers no provision fund and focuses instead on diversification through its auto-investment facility. Learn more by reading our Funding Circle review.

  • Target interest rates – 4.5 to 6.5%
  • Self-select vs. auto-investment – Auto-investment only.
  • Secondary market – Yes, subject to fees of 1.25%.
  • IFISA – Yes.
  • Minimum investment – Invest from £1,000.
  • Cashback offer – £50 Amazon voucher if you invest £2,000 via this referral link.

Platforms offering a mixture of secured and unsecured lending:

There are six UK-based peer-to-peer lending platforms which provide a mixture of secured and unsecured business loans:

Wise Alpha (launched 2014)

WiseAlpha is not strictly peer-to-peer lending. The platform offers corporate bond investment, with a choice between senior secured bonds and high yield unsecured bonds to established blue-chip companies. Small investors can acquire small fractions of corporate bonds (which in totality, can be hundreds of millions of pounds). The brands featured on the website are typically household names (e.g. Netflix, Aston Martin, William Hill, to name but a few).

  • Target interest rates – 4.0 to 16.0%
  • Self-select vs. auto-investment – Both available.
  • Secondary market – Yes, subject to 0.25% fee.
  • IFISA – Yes.
  • Minimum investment – Invest from £100.
  • Cashback offer – £25 if you invest £1,000, £50 if you invest £5,000, £100 if you invest £10,000, going up to £250 if you invest over £25,000. [To be updated with link]

ArchOver (launched 2014)

Archover lends to UK SME’s in a variety of sectors, through one of five lending services: 1) Secured and Insured, 2) Secured and Assigned, 3) Secured, 4) Bespoke and 5) Research and Development Advance loans. The first four loan types are secured forms of lending, whilst R&D advance loans are unsecured.

  • Target interest rates – 6.0 to 11.0%
  • Self-select vs. auto-investment – Yes, both options available.
  • Secondary market – No.
  • IFISA – Yes.
  • Minimum investment – Invest from £250.
  • Cashback offer – £75 if you invest £5,000. [To be updated with link]

Crowd2Fund (launched 2014)

Crowd2Fund offers short-term (1-5 years) business loans ranging between £20,000 and £2 million. The products offered are standard loans (with monthly repayments of capital and interest), revenue-based loans (fluctuating monthly repayments of capital and interest depending on company revenue) and bonds (monthly payments of interest, with capital repaid on maturity). Crowd2Fund allows you to download a copy of the full loan book to see the latest status of all loans.

  • Target interest rates – 6.0 to 15.0%
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, with no selling fees.
  • IFISA – Yes.
  • Minimum investment – Invest from £1,000.
  • Cashback offer – 2.0% cashback offer available [To be updated with link]

Lending Crowd (launched 2014)

Lending Crowd provides UK SME’s with financing ranging from £5,000 to £500,000. Loans are provided for debt restructuring, working capital, asset purchase and growth finance. The loan book is well diversified with no one sector comprising more than 15.0% of total lending, whilst approximately 1/3 of the loan book is risk graded A/A+, with the remainder between B+ and C+.

  • Target interest rates – 5.95 to 14.25%
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, subject to a 0.5% selling fee.
  • IFISA – Yes.
  • Minimum investment – Invest from £20.
  • Cashback offer – £50 when you invest £2,000 [To be updated with link]

Rebuilding Society (launched 2012)

The Rebuilding Society offers a mixture of secured and unsecured business lending. The loans offered via the platform are typically quite high risk, offering returns of up to 20.0% for the riskiest C-grade rated loans.

  • Target interest rates – 7.9% average (but up to 20.0%)
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, subject to a 0.5% selling fee.
  • IFISA – Yes.
  • Minimum investment – Invest from just £10.
  • Cashback offer – £25 when you invest £1,000 [To be updated with link]

Huddle Capital (launched 2017)

Huddle Capital offers both secured and unsecured loans to UK SME’s. It’s worth noting that the business holds its permissions to trade as a peer-to-peer lender through Rebuilding Society as an Appointed Representative. Despite this, Huddle does operate independently and features its own individual peer-to-peer loan opportunities.

  • Target interest rates – 6.0 to 16.0%
  • Self-select vs. auto-investment – Both options available.
  • Secondary market – Yes, with no selling fees.
  • IFISA – No.
  • Minimum investment – Invest from just £5.
  • Cashback offer – No cashback offer currently available.

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