Innovate Finance chief executive Janine Hirt has applauded the peer-to-peer lending sector for demonstrating its strengths during the pandemic as it looks to produce data to showcase its resilience.
Hirt (pictured) has said that the sector’s published loan returns demonstrate that it survived Covid and is here to stay.
“I very much see P2P lenders continuing lending in the small- and medium-sized enterprise and property sectors as the economy recovers,” she said.
“I think the fact P2P lenders demonstrated through published loan returns that they could navigate through the Covid crisis effectively is a huge step to showing investors and policymakers that their cycle investment returns are positive.”
Innovate Finance has been working with the 36H Group to aggregate data around alternative lenders and state-backed lending schemes.
Hirt said the aim is to showcase the sector’s worth to policymakers after “pushing above its weight” during the crisis, delivering loans through state-backed lending schemes such as the coronavirus business interruption loan scheme (CBILS).
She said the trade body is currently looking at existing data from the Cambridge Centre of Alternative Finance (CCAF) and the British Business Bank and has started asking its members for feedback on their private data.
The CCAF’s latest report last month showed that global transactions of online alternative finance, excluding China, increased 24 per cent year-on-year to reach $113bn (£81.6bn) in 2020. Innovate Finance’s own data showed a 34 per cent year-on-year rise in investment into the UK fintech sector in the first six months of 2021.
Figures from the British Business Bank has shown that lenders have delivered 1,670,939 loans worth £79.3bn through Covid state-backed lending schemes, including £26.39bn through CBILS.
“We’re really pointing to the fact we know alternative lenders pushed well above their weight during the crisis in terms of CBILS loans,” Hirt said.
“Funding Circle, since they were listed as an accredited lender, accounted for more than 25 per cent for all of the CBILS loans and were the third largest CBILS lender. That alone speaks a huge amount for the sector and we’re aggregating some of the other information from our members as well.
“I definitely believe there is a benefit in showing more data around the critical role alternative lenders played delivering CBILS loans. The more we can showcase with tangible data will then enable policymakers to see the demonstrable proof of the benefit of having these players in the market.”
Hirt said alternative lenders, including P2P firms, can help support the government’s levelling up agenda by reaching everyone across the UK and supporting the existing framework.
In July, Mike Carter, head of platform lending at the 36H Group, said the trade body will start collecting and publishing data on P2P lending volumes in the second half of this year.