New FSB chair hails benefits of P2P
The new national chair of the Federation of Small Businesses (FSB) has spoken out about the benefits of alternative finance options such as peer-to-peer lending.
Martin McTague was confirmed as the new national chair during the FSB’s annual general meeting on 7 March. He takes over from the incumbent Mike Cherry, who has held the position for six years.
McTague told Peer2Peer Finance News that he believes that the rise of open banking and alternative finance have “been to small businesses’ benefit” by adding competition and flexibility in the market.
“The incredible diversity of the UK’s small business community is reflected in the need for different kinds of finance to suit unique needs and circumstances,” said McTague.
Read more: Lack of access to finance threatens businesses’ growth plans
“Traditional bank loans and overdrafts will always have a place, but small firms now can make use of other options as and when it suits them to do so, from equity finance to asset finance, P2P finance, and much more.
“The rise in alternative finance providers and non-traditional funding sources has been to small businesses’ benefit, meaning more competition and flexibility in the market.
“At the same time, Open Banking-enabled online platforms have given business owners a more granular view of their finances, with more immediate feedback, whilst making applications more efficient.”
Through the FSB funding platform, the trade body provides its members with bespoke finance options, including alternative financing. McTague said that the FSB will “absolutely continue” to work with funding providers, alongside organisations such as the British Business Bank.
Read more: 92pc of SMEs would switch lenders amid funding drought
“Commercial lending as a whole, and alternative finance provision within that, took a significant knock at the time that Covid-related finance dominated, especially at low fixed rates underpinned by the government,” he said.
“It’s now important that we re-establish a viable, engaged and competitive market to give small businesses the widest possible choice of options that suit their business needs.”
During the AGM, FSB board member Tina McKenzie, was appointed FSB chair for policy and advocacy. McKenzie is a well-known figure in the Northern Ireland business community and took a leading role in advocating for small businesses in Northern Ireland during the Brexit process.
Read more: Government backs crowdfunding sector with plans to cut to the red tape