Innovate Finance chief Charlotte Crosswell has expressed disappointment at the fact that non-bank lenders were denied access to the Bank of England’s term funding scheme.
At the start of June, Peer2Peer Finance News revealed that Innovate Finance was representing peer-to-peer lending platforms in talks about non-bank lenders receiving access to cheap funding from the bank. However in July, this was blocked by large banks, according to The Sunday Times.
Crosswell announced her disappointment that non-bank lenders – including P2P lending platforms – were denied access to these funds, joining Goodbody analyst John Cronin who questioned the government’s support for the fintech sector.
“Bounce back loans being set at very low interest rates proved a challenge for the sector because it was incredibly hard for non-bank lenders to fulfil this without access to bank funding,” she said.
“Lenders have to distribute the funds quickly and one solution is access to bank funding.
“There were a lot of P2P and non-bank lenders that wanted access to that low interest rate, but unfortunately we were unsuccessful in securing access to Bank of England funding.
“We would have liked to see an approach where the role non-bank lenders would have played with the bank funding was recognised.
“Over the summer we’ve voiced the role non-bank lenders can play, helping service small– and medium-sized enterprises, and how innovative fintechs and P2P are able to be part of the solution.”
Crosswell, who is part of a financial services group representing P2P and fintechs in post-Brexit trade talks, recently told Peer2Peer Finance News that she has been “encouraged” by the positive response to the P2P lending sector during the Covid-19 pandemic, and hopes that if a second wave of the coronavirus hits, alternative lenders will be utilised more by the government.