Table of Contents
Overview
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- What you need to know
- Covered in this Report
Executive Summary
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- The market
- Market lending reaches all-time high in 2018
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- Figure 1: P2P business lending, 2014-18, by market value, (£ million)
- Property and construction obtain highest amount of lending
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- Figure 2: P2P business lending, 2018, by sector, (% of total lending)
- South East most common destination for P2P business lending
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- Figure 3: P2P business lending, 2018, by region, (% of total lending)
- P2P business lending to rise by 75% to 2023
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- Figure 4: P2P business lending forecast, 2019-23, by market value, (£ million)
- Companies and brands
- What we think
Issues and Insights
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- FCA review calls for greater transparency
- The facts
- The implications
- The rising number of SME funding aggregators has been criticised
- The facts
- The implications
The Market – What You Need to Know
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- Market lending reaches all-time high in 2018
- Lending by sector
- P2P business lending to rise by 75% to 2023
Market Size
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- Market lending reaches all-time high in 2018
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- Figure 5: P2P business lending, 2014-18, by market value, (£ million)
Market Segmentation
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- Lending by sector
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- Figure 6: P2P business lending, 2018, by sector, (% of total lending and £ million)
- Lending by region
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- Figure 7: P2P business lending, 2018, by region, (% of total lending and £ million)
Market Forecast
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- Business lending to rise by 75% to 2023
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- Figure 8: P2P business lending forecast, 2019-23, by market value, (£ million)
- Platforms must attract ‘high quality’ borrowers and diversify to continue growth
- Mainstream lenders react to emerging alternative finance threat but collaboration could still occur
The Impact of the Economy
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- GDP growth rebounds in Q2 but challenges remain
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- Figure 9: GDP growth rate, Q2 2014-Q2 2018, (% change on previous quarter)
Market Trends
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- Business confidence turns positive in Q2 2018 which will influence demand for finance, but uncertainty remains
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- Figure 10: Business confidence index, per half-year, Q4 2007-Q2 2018, (index figure)
- Credit demand and availability rises for small businesses
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- Figure 11: Availability of corporate credit provided to small businesses in the past three months, Q3 2012-Q2 2018, (net percentage balance)
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- Figure 12: Demand for corporate lending by small businesses in the past three months, Q3 2012-Q2 2018, (net percentage balance)
- Nearly half of SMEs have never checked their credit score
- Lenders shift focus to recurring revenue
Market Drivers
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- Brexit uncertainty still affecting lending environment
- Accountants could help drive further growth in P2P lending
- Open Banking initiative should drive product and service innovation
- Lack of suitable SME finance offers significant opportunities
Regulation and Industry Standards
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- The Small Business, Enterprise and Employment Act
- The Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001
- P2PFA Industry Standards
Companies and Brands – What You Need to Know
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- Institutional funding on the rise in the sector
- Some lenders have scrapped manual lending in favour of automated lending
Industry Structure
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- Industry development
- Institutional funding on the rise in the sector…
- …with IFISAs also providing a funding boost
- Market share
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- Figure 13: P2P business lenders, cumulative lending and market share, (in £ million and %)
Competitive Strategies
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- Some lenders have scrapped manual lending in favour of automated lending
- Lenders seek to specialise in certain product areas
Company Profiles
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- ArchOver
- Recent company activity
- Financial information
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- Figure 14: Financial analysis of ArchOver, 2014-17, (£ 000)
- Assetz Capital
- Recent company activity
- Folk2Folk
- Recent company activity
- Funding Circle
- Recent company activity
- Financial information
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- Figure 15: Financial analysis of Funding Circle, 2012-16, (£ 000)
- LendingCrowd
- Recent company activity
- ThinCats
- Recent company activity
- Financial information
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- Figure 16: Financial analysis of Business Loan Network Limited (under the trading name of ‘ThinCats’), 2015-16, (£ 000)
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Methodology
Further Sources and Contacts
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- Trade associations
- Association of Short Term Lenders
- Financial Intermediary & Broker Association (FIBA)
- National Association of Commercial Finance Brokers
- Peer-2-Peer Finance Association (P2PFA)
- Trade magazines
- Bridging & Commercial
- Business Matters
- Commercial Reporter
- Loans Insider
- Peer2Peer Finance News
- Trade events
- AltFi London Summit 2019
- Financial Services Expo London 2018
- NACFB Commercial Finance Expo 2019
- The Finance Professional Show
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