A Business Lending Revolution

How small and medium sized businesses are

benefiting from peer-to-peer lending

Todays session

What is peer-to-peer lending & the SME lending landscape

Using technology & innovation to make borrowing simpler & faster

What does the future looks like

Hear from a Funding Circle borrower

Questions

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Peer-to-peer lending

and the

SME lending landscape

What is peer-to-peer lending?

Traditional lending

Peer-to-peer lending

A simple model: Lenders can spread risk by lending

small amounts to hundreds of businesses

Business loan

Loan parts

Loan parts

Loan parts

Loan parts

Loan parts

Loan parts

Loan parts

Loan parts

Loan parts

The growth of alternative options is creating

healthy competition in the market

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Total SME lending by provider

Bank lending Non-bank lending

Estimated 85% of SME lending is through the

five big banks

Source: Project Merlin, Bank of England; Funding Circle analysis; does not include loan secured on property

Bank lending includes lending from the five big banks: Barclays, HSBC, LBG, RBS and Santander

Lending pm, £bn

UK Business peer-to-peer lending (P2B) has

now surpassed £700 million

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Mill

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Other Business p2p lending Funding Circle lending

Source: Funding Circle analysis

“71% of SMEs approach

only one provider

of finance”

British Business Bank, 2013

Using technology and innovation to

create a better solution

Convenience and simplicity of application

Application Fees

Online application means business

can apply 24/750% of Funding Circle loans are

applied for out of business hours

Assessment Funding Fees

Simplified online application –

no business plans to apply

Instant decision on whether you

have passed the first stage of

approval

Fast decision making

Application Fees

Technology supporting operational

effectiveness means faster decision

making

All Funding Circle loan

applications get a decision in

2 working days

Assessment Funding Fees

Marketplace lending: connecting lenders

and borrowers

Application Fees

Loans are typically funded by a

marketplace where investors compete to

lend to businesses

Only the lowest bid rates are successful

on the loan

32,000 retail investors and

other organisations

Assessment Funding Fees

10% of most loans currently

funded by British Business

Bank*

* The British Business Bank Investment Programme is a part of the British Business Bank programme, which is currently run

directly by the Department for Business, Innovation and Skills and is not authorised or regulated by the Financial Conduct

Authority or the Prudential Regulation Authority. British Business Bank plc will operate as a Government-owned financial

institution once HM Government has received European Commission State aid clearance, which is expected in 2014.

Transparency of fees

Application Fees

Transparent fee structures, so businesses

can understand the total costs they will

ever be charged

One-off arrangement fee

Assessment Funding Fees

No early repayment fees

Continued growth of marketplace lending

Diversity of options for businesses

Collaboration to provide real support

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What does the future look like?

Hear from a Funding Circle borrower

Link: https://www.youtube.com/watch?v=1_-GWQz5Uys

Thank you

Funding Circle Limited is authorised and regulated by the Financial Conduct Authority under firm registration number

635439. Funding Circle is not covered by the Financial Services Compensation Scheme. Registered in England (Co. No.

06968588) with registered office at 3 Dorset Rise, London, EC4Y 8EN.