LendingCrowd has predicted “significant new lending activity” for the remainder of 2021, after posting a loss last year due to “reduced activity” amid the pandemic.
The Scottish peer-to-peer business lending platform posted a loss of £1.14m in the 12 months to 31 December 2020, according to its latest annual accounts filed with Companies House.
This was down slightly from a loss of £1.97m in 2019.
Read more: LendingCrowd loses 4th Way rating
“Whilst the company made a loss for the year, this was anticipated and tightly controlled,” LendingCrowd said in its results.
“The loss was due in part to reduced activity as a result of the Covid pandemic. The company had bank balances of £1.1m at the year end. As budgeted, lending has been limited during the first quarter of 2021, however the company is forecasting significant new lending activity for the remainder of 2021.
“This is based on new lending facilities, negotiation of which are at an advanced stage, and management’s realistic assessment of demand levels for new loans.
“Current forecasts indicate that the company may need a limited level of additional equity funding in early 2022, however the directors are satisfied that this can be controlled through increasing lending volumes, expense management or if required, that the funding would be available from the shareholder base.
“The key assumptions in management’s forecasts are the availability of debt capital, the size and phasing of borrower demand and availability of additional equity funding should it be required.”
The platform started lending under the coronavirus business interruption loan scheme – a government-backed loan scheme to support businesses during the pandemic – in September last year. As a result, it closed to retail investors as funding for CBILS loans is restricted to institutional lenders.
CBILS closed at the end of March this year but LendingCrowd remains closed to retail investors with its secondary market still temporarily suspended.
A spokesperson said the platform assesses the situation monthly.
“We’re constantly assessing this, we’ll be guided by what we’re seeing and trends in the market,” the spokesperson told Peer2Peer Finance News.
“We’re still in the early stages of coming out of the pandemic, we’re seeing the furlough scheme has finished and there’s still a number of wider economic factors at play we have to monitor and that’s what we take into account when evaluating our decision.
“We communicate with our retail lenders regularly to update them on the status and still want to communicate that the market is temporarily suspended.”