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Peer2Peer Finance News | September 23, 2019

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Barclays loans contribute to widening losses at MarketInvoice

Barclays loans contribute to widening losses at MarketInvoice
Kathryn Gaw

MARKETINVOICE saw its losses widen to £4.72m last year, due to a £1.17m interest bill for loans and convertible loan notes.

The invoice finance and business loans provider reported an overall loss of £4.72m for the 12 months to 31 December 2018, compared to £4.21m the previous year.

However, over the same time period the lender was able to increase its revenue and gross profit by 23 per cent and 30 per cent, respectively. This narrowed its operating loss to £3.58m from £4.6m, according to accounts filed with Companies House this week.

The interest payments were largely due to a series of convertible loan notes issued to Barclays Converted Investments. On 2 August 2018, MarketInvoice issued Barclays with £12m of these notes, at an interest rate of 15 per cent per annum. By 31 December 2018, the total loan outstanding including interest was £8,937,033.

Read more: Barclays begins deploying funding through MarketInvoice

Prior to that, MarketInvoice issued £3.2m of convertible loan notes to a “pool of investors led by a director of the company” in April 2018, which also have an interest rate of 15 per cent. By 31 December 2018, £3,539,012 was outstanding on this facility.

MarketInvoice also had a £2m venture debt loan from Silicon Valley Bank, at a fixed interest rate of 10 per cent. This loan was repaid in full at the end of January 2019.

Last year, MarketInvoice announced a strategic partnership with Barclays, whereby the bank would fund at least £1bn worth of invoices via its platform over the next few years. As part of the deal, Barclays took a minority stake in the firm and offers MarketInvoice products to its business customers.

“By collaborating with bank partners, we will be reaching many thousands of companies here in the UK and abroad to support their business finance needs,” said Anil Stocker (pictured), chief executive of MarketInvoice. “We aim to invest in technology, data and strategic partnerships to take MarketInvoice to the next level.”

MarketInvoice also raised £26m in equity funding last year, led by Barclays and Santander InnoVentures. Viola Credit, who also participated in the equity funding round, additionally provided a £30m debt facility to fund business loans on the platform.

Read more: MarketInvoice: SMEs favour invoice finance over business loans for growth