Crowd2Fund is offering suitable borrowers the option to switch to a revenue loan from a fixed term loan, to help protect businesses during the pandemic.
The peer-to-peer business lender’s revenue loan product gives borrowers more flexibility than a traditional fixed-term loan, as repayments are correlated to monthly turnover.
Crowd2Fund said that investors are also likely to earn more interest as a result of a switch, as capital may be deployed for longer. However, an investor can still choose to sell their loan on the exchange.
Read more: Crowd2Fund offers zero fees to NHS employees
“Our revenue loan is a completely unique financial product, perfectly suited to small businesses that undergo seasonal revenue fluctuations,” the platform said in a blog on its website.
“This loan is a great advantage during a period of low revenue, as it helps your business keep a perfect loan status without putting pressure on your cash flow — all while presenting a clear repayment structure.
“During the Covid-19 crisis, we are promoting this innovative product — helping businesses access capital, earn good interest for investors, and offer much-needed flexibility. The Crowd2Fund revenue loan is well established and already used by a wide range of clients.”
Businesses looking to switch loans also need to provide evidence that they have applied for the coronavirus business interruption loan scheme emergency funding as part of the application process.
Crowd2Fund will inform investors about the change in loan schedule on behalf of businesses.
And firms can revert back to fixed repayments after the crisis.