Funding Circle updates underwriting process
Funding Circle will now tell brokers if a borrower is eligible to borrow more money than they applied for, through its improved underwriting process.
In an update this week, the London-listed small business lender said account managers will contact the broker to make them aware if their client is eligible for more, enabling them to discuss it with their client if appropriate.
The platforms hopes it will provide businesses with greater flexibility in the amount they borrow, and allow brokers to better meet the needs of their customers.
Read more: LendingTree adds Funding Circle US to its network
Meanwhile, the firm’s latest survey of small- and medium-sized enterprises (SMEs) has revealed that SMEs are holding up well in 2023’s tough trading conditions, despite 40 per cent saying that costs have quickly replaced the pandemic as their primary concern.
Citing the Office for National Statistics’ Business Insights and Conditions Survey, Funding Circle said about one in four businesses were seeing reduced revenue but the percentage of SMEs with more than six months of cash reserves increased to 42 per cent by the end of 2022.
SMEs are still cautious about pursuing growth, according to Funding Circle. However, it said research by the Federation of Small Businesses revealed that two-thirds of SMEs were planning to make some form of investment by 2024.
Read more: Funding Circle eyes asset management funding amid bank turmoil
The lender reported that the UK’s 650 parliamentary constituencies, received an average of £1.6m in loans each from the platform last year.
Local authority districts in the top 10 per cent for highest unemployment rates received 13 per cent of Funding Circle’s lending that year, while those with the lowest rankings in the English Index of Multiple Deprivation received 12 per cent.
“With innovative technology a focus of ours, it’s also exciting to see that SMEs still value the speed and ease that they can get a loan with us,” the platform said.
“Some 32 per cent of surveyed customers said it was the simplicity of the application that attracted them, whilst 31 per cent cited the fast process.”
Funding Circle officially exited the peer-to-peer lending space last year and said that retail investors now make up just two per cent of loans under management.
Read more: Funding Circle swings into red as government Covid schemes end