ThinCats has said it supported borrowers throughout the Covid-19 crisis, via payment holidays and government-backed loans, without changing its credit processes.
Greg Beamish, head of credit at ThinCats, said that the alternative business lender contacted all existing borrowers in March to understand the immediate impact of the lockdown on their business and assess their resilience to further restrictions.
The platform introduced interest and capital repayment holidays where required, revised or suspended covenants and ensured that new capital requests were in progress.
Beamish said that ThinCats continued its engagement with borrowers as well as using data from its proprietary credit model, PRISM.
ThinCats, which was accredited for the coronavirus business interruption loan scheme (CBILS) at the end of April, funded its first CBILS loan in June.
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“We believe this early and easy access to credit decision makers is a key difference between us and the banks,” Beamish said in a blog on ThinCat’s website.
“In respect to CBILS it proved critical in enabling us to thoroughly understand the impact of the Covid pandemic on a particular business, and to create a funding structure to best suit its immediate as well as longer-term needs.”
Beamish said that the platform’s initial conversations with existing borrowers for CBILS loans were for providing much-needed additional working capital to maintain liquidity.
Meanwhile he added that when the lender opened CBILS to new borrowers it saw a significant rise in proposals for growth funding including for acquisitions.
Beamish said as part of ThinCat’s underwriting process it also had to assess if there had been any fundamental structural changes resulting from Covid that could impact a business’s future prospects.
He said that it’s likely that working from home for at least a few days a week will become much more common post pandemic, so companies heavily reliant on trade from commuters or city centre office workers may be facing long-term impacts.
“Calling on our expertise in this area and following conversations with the local business development and credit teams we were able to quickly inform advisers and borrowers whether we would be able to support the proposal or not, which provided valuable certainty to all parties,” Beamish said in the blog.
“There’s no doubt that CBILS accreditation has played an important role in bringing alternative lenders such as ThinCats into the mainstream.
“We look forward to seeing whether the successor to CBILS will help deliver the ongoing funding required by UK businesses as the positive momentum from the rollout of Covid vaccination programmes and the gradual lifting of restrictions create an environment for strong economic growth.”