Peer2Peer Finance News

Boost for SMEs as business loan application times drop

Publication: Peer2Peer Finance News
2nd March 2020

The time it takes for small- and medium-sized enterprises (SMEs) to secure finance has fallen by a quarter over the past two years, according to finance aggregator Funding Xchange.

Analysis of a sample of 584 customers applying for business loans, through the Funding Xchange marketplace, found the average time between a funding offer being made and finance being drawn down fell from 19 days at the start of 2018 to 14 days at the end of 2019.

Funding Xchange said this was driven by digital lenders making quicker decisions as well as lower interest rates in the SME lending market.

Businesses using Funding Xchange's marketplace that have strong credit profiles are benefiting the most, with half of those firms accessing funds within 10 days of application and 15 per cent within just 24 hours.

The platform, which matches business borrowers with both mainstream and alternative lenders including Funding Circle, also said it has partnered with data analytics, cloud accounting and banking software providers ezbob to allow applications to be processed in as little as seven minutes.

“With SME confidence still recovering from an unstable political and economic environment, it is crucial that businesses with an immediate need can continue to seek and find access to the best sources of funding,” Katrin Herrling (pictured), chief executive of Funding Xchange, said.

“The accelerating speed of digital decisioning is transforming the market, creating more transparency, competition, and ultimately speed. The best customers can now get confirmed offers within minutes — giving them the experience that they have become accustomed to as consumers.

“We expect significant leaps in the next 18-24 months as new data sources and technology, including Open Banking and cloud accounting, enable the delivery of end-to-end and instant decisioning for SMEs seeking funding of up to £50,000.”

Read the original article on P2P Finance News