RATESETTER is planning to ramp up its business lending, after working behind the scenes last year to boost its small- and medium-sized enterprise (SME) technology and grow its dedicated team.
The peer-to-peer platform’s main focus was originally on consumer lending. Even now, it has a ratio of nine to 1 between consumer and small business loan volumes.
But it sees opportunities for growth within the sector, as SMEs across the country grow increasingly hungry for working capital.
“We now have all the right technology and relationship management in place to help SMEs access finance in the easiest possible way” Paul Marston, who joined the firm in January last year as managing director of commercial finance, told Peer-to-Peer Finance News.
Small businesses have shrugged off Brexit, with the weak pound creating a very strong case for boosting exports, Marston said. The firm found that in the South East region alone, at least 40 per cent of small companies are looking to grow in the next six months.
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“What really needs to happen now is that they grow familiar with the available alternatives to bank finance to become truly operationally efficient,” Marston said.
The macro conditions, combined with high-street lenders’ short-sighted, profit-based approach and Funding Circle’s booming business last year clearly demonstrate that there is room for everyone in the SME finance space, he added.
The rival platform’s success in the segment only proves that “there’s a huge market, which means we don’t have to compete head-on,” he said.
“Besides, our proposition is different as we don’t use an auction house, which means we can provide more immediate credit.”
RateSetter has streamlined its online application process to ensure that SMEs can obtain finance within three hours – a strategy that was validated by the recent approval of a £100,000 loan in 41 minutes, Marston said.
Part of the online form is pre-filled quickly through Companies House data.
“But public data can’t tell you everything about a business, so we have also set up a regional relationship manager network so that we can really hear what their story is,” he added.
This article was first featured in the April print edition of Peer-to-Peer Finance News. For more information on receiving the monthly print magazine, complete with exclusive content, email firstname.lastname@example.org.