Peer to peer lending outfit RateSetter has announced it will soon begin extending its lending facilities beyond individuals and sole traders to small businesses. The move is being supported by government, with backing coming from the British Business Bank, which has pledged to channel £10m of finance through the RateSetter platform.
The aim, RateSetter head of commercial finance Paul Marston said, is to help SMEs scale up and become more productive, helping small businesses in a way that high banks currently do not. “We’re investing in relationship managers to offer a fundamentally true alternative for SMEs who are not getting lending decisions through banks; they’re not sure who to speak to because their relationship managers are being restructured.”
‘More funds committed’
RateSetter has been trialling the new lending scheme discreetly, but is now set to roll it out to a wider audience, and will focus on lending amounts of anywhere from £25,000 to £1m. The news comes after several High St banks, including Barclays and HSBC, have committed themselves to increasing the amounts lent to smaller businesses in the UK.
It also comes after a number of figures from government and business have expressed concern over how P2P lenders and other alternative finance providers are run, with fears that extending the pool of lenders may attract some who are unqualified or unscrupulous.