FUNDING Xchange, the business finance aggregator, has closed an £8m funding round and plans to use the proceeds to roll out its while label product.
The fundraise, which was led by venture capital firms Downing Ventures and Gresham House Ventures, will enable Funding Xchange to accelerate the roll-out of its white label ‘lending in a box solution’, which digitises key steps in the underwriting process.
“We are delighted that Downing and Gresham House have joined us on our exciting journey to help reshape a sector that is rapidly adopting digital solutions using new data sources to enable the delivery of seamless, instant access to finance,” said co-founder and chief executive Katrin Herrling.
“This is creating the opportunity to provide small businesses with the same transparency and ease of access to finance that consumers have become accustomed to.
“The funding round will enable us to accelerate the delivery of the next generation of our data and decisioning platform that enables banks and lenders to instantly transform their customer proposition by digitising their customer interfaces and decisioning to deliver personalised and transparent access to their own lending products or refer customers to selected third party lenders.”
Funding Xchange holds lenders’ underwriting models to speed up the decision-making process on business loans. Through its platform, businesses can access personalised funding quotes in less than four minutes and receive funds within 10 minutes. The company has also integrated access to finance into payment solutions and cloud accounting software.
“Funding Xchange is delivering digital solutions that respond to some of the biggest challenges that banks and SME lenders face as the market is undergoing unprecedented change – driven by new lenders and solutions changing the market dynamics, availability of new data and increasing regulatory scrutiny,” said Daniel Cheung at Downing Ventures.
“The next phase of Funding Xchange’s growth is now seeing lenders leverage Funding Xchange’s digital technology to provide their customers with instant, personalised quotes while reducing their own costs to serve customers by 70 per cent. As a technology and data analytics business, Funding Xchange’s market insights are already helping banks and lenders build and test funding propositions that respond to customer needs and address the funding gap. This is game changing in a market that has been notoriously opaque.”
Funding Xchange is one of three business finance aggregators designated by the Treasury as a finance referral platform, as part of the bank referral scheme. The scheme mandates high street banks to refer rejected business borrowers to the platforms, which then in turn will introduce them to alternative funding options.
IMAS Corporate Finance advised Funding Xchange on its latest investment round.