BANKS may be closing branches up and down the country, but peer-to-peer lenders are recognising the benefits of having a local presence.
Research by consumer watchdog Which? found that more than 1,000 branches of the main high street lenders including Halifax owner Lloyds, RBS and HSBC, closed in 2016.
Banks point the blame at a lack of use and a move to mobile banking, but many P2P firms are seeing the value in both technology and a local presence when it comes to lending.
Assetz Capital announced in September that it is planning to hire 35 relationship directors and open new branches across the country to support its expansion into small-business lending.
Stuart Law, chief executive of Assetz Capital, said the platform is aiming to have between 10 and 12 branches by the end of this year.
“The bank branch network is expensive. They are dealing with people who occasionally come in to bank a cheque,” he told Peer-to-Peer Finance News.
“Our branches are different. They provide a hub for borrowers to put forward a proposition for lending.”
Bricks Finance, a development finance P2P lender, takes the same approach.
Rather than purely communicating online, investors and borrowers have to meet directly with the Exeter-based firm to discuss their options.
“As we are lending our money alongside our investors it makes good business sense for us to meet local lenders and borrowers,” said Clive Banks, director of Bricks Finance.
Another platform, Folk2Folk, is planning to grow from three to 10 branches across the UK by the end of the year.
Read more: Folk2Folk to launch North Yorkshire branch
“By having a physical branch, we can offer a very personalised and friendly service rather than just being online, which tends to be a user-led, one-way experience,” said a spokesperson.
“Our branches are a way to help our borrowing customers come in, sit down and get a decision in a matter of days rather than weeks.”