P2P sector ready to play greater role in next wave of Covid-19 funding
The alternative lending sector has urged the government to make use of P2P lending platforms as part of the economic support package offered to businesses during the second wave of Covid-19.
Atuksha Poonwassie, co-founder and managing director of Simple Crowdfunding and director of the UK Crowdfunding Association, said that P2P and alternative lenders should play a larger role in the economic recovery.
“Having access to finance from more channels is definitely a good thing because it means more people will potentially get access to finance faster,” she said.
“And I think the P2P lenders that have provided finance through the first wave have done a good job so P2P should be utilised more during the second wave, because we’re here to help.”
Daniel Rajkumar, managing director of Rebuildingsociety, said that fintechs will be key to supporting the recovery and helping to allocate capital more efficiently across the economy.
“A lot of traditional financial organisations have had to restructure and find more efficient ways of operating and working, but fintechs are best placed to be catalysts for recovering the economy quickly,” he said.
“They are more nimble, flexible, innovative and quicker.”
Last month, Charlotte Crosswell, chief executive of trade body Innovate Finance, told Peer2Peer Finance News that she hopes fintechs and P2P lenders will be utilised more if a second wave of Covid-19 hits.
“I’ve been encouraged by conversations recognising the role P2P has played during the crisis,” Crosswell said at the time.
“I certainly hope fintechs and P2P are considered more if there’s a second wave. With whatever comes next it’s important that both banks and non-bank lenders are taken into consideration for the amount of business lending taking place.”
At the start of May, Peer2Peer Finance News issued a rallying call for the industry to be utilised amid the Covid-19 crisis.
The sector has already played a huge role in the government-backed economic support schemes, with Assetz Capital and Funding Circle delivering millions to small- and medium-sized enterprises (SMEs) through the coronavirus business interruption loan scheme (CBILS).
However, only four P2P lenders were accredited to CBILS, and Funding Circle was the only P2P lender approved to participate in the bounce back loan scheme.
Earlier today, it was revealed that the Treasury is reportedly set to extend its support schemes ahead of an expected second wave of Covid cases in the coming weeks.
