Propio is hoping to utilise the government’s future fund to raise £300,000, to support its delayed move into the peer-to-peer lending space.
In April, the property investment platform said it had already stopped offering new mini-bonds and was in the midst of a funding round to support its launch into the P2P lending market in May or June.
However, Peer2Peer Finance News has learnt that the P2P launch has been pushed back until September after a cornerstone investor pulled out of the funding round due to the pandemic.
Propio is now hoping to use the government’s future fund – one of the government’s emergency support packages – to support its fundraising efforts. The future fund offers convertible loans ranging from £125,000 to £5m from the government, subject to at least equal match funding from private investors.
Propio is aiming to raise £150,000, which would then be matched by the future fund to make a total of £300,000.
The property investment platform has set the target of having the funding in place by August and then will submit its appointed representative application to Rebuildingsociety in order to become a P2P lending platform by September.
“It was unfortunate the launch was delayed,” said Tom Buttress, co-founder and chief executive of Propio.
“I think we’re pleased the government has stepped in with the future fund which provides innovative and high growth businesses with matched funding to support them through the coronavirus crisis, and we’re looking to make use of this initiative to support the growth of our property focussed P2P lending platform.”
P2P lender Assetz Capital is currently using the government’s future fund to support its latest Seedrs equity crowdfunding campaign.
The property market has undergone much change over the past few months.
It was hit by a lockdown in March that effectively put the housing market on hold, then more recently bounced back when restrictions were eased and construction sites reopend, and yesterday was given a boost by a cut in stamp duty for properties under £500,000.
“There has been a reduction in some property values, but we’re pleased with how the market has reignited with transactions now moving again,” said Buttress.
“People are now moving and buying houses again and yesterday’s announcement to increase the stamp duty threshold is a welcome initiative to help the market recover.”