British Business Bank lends £40m through Funding Circle
In three and a half years since we launched, thousands of British people, as well as organisations such as local councils and universities, have helped to lend over £220 million to 4,000 businesses. We are currently lending an average £5 million worth of loans per week.
Last March the Government began lending to British small businesses through Funding Circle, as part of its Business Finance Partnership scheme. Government involvement has played an important role in increasing awareness of Funding Circle in the business community.
Today we’re pleased to reveal that they have nearly lent out their entire £20 million commitment to over 2,000 businesses across the country, helping to create an estimated 6,500 jobs. We’re also pleased to confirm that the Government-backed British Business Bank Investment Programme has decided to invest a further £40 million alongside private investors. It’s worth noting that there is still a week’s worth of money left from the original £20 million so you will see loans part-funded by the Government this week (24th February).
The British Business Bank Investment Programme is a part of the British Business Bank programme, which is currently run directly by the Department for Business, Innovation and Skills and is not authorised or regulated by the Financial Conduct Authority or the Prudential Regulation Authority. British Business Bank plc will operate as a Government-owned financial institution once HM Government has received European Commission State aid clearance, which is expected in 2014.
The objective of the British Business Bank programme is to support economic growth by bringing together public and private sector funds to create more effective and efficient finance markets for smaller businesses in the UK.
The investment through the Funding Circle platform is made alongside investors from the private sector on equivalent terms and represents the final 10% of funding requested by a borrower, once private sector lending has reached 90% of the requested amount. The British Business Bank programme’s funding does not provide an endorsement, recommendation or any warranty, either expressed or implied, about the creditworthiness of a borrower or the activities and procedures of Funding Circle, and its funding has the same risk of loss as for any private sector investor.
Neither the British Business Bank programme, the Department for Business Innovation and Skills nor any other government department or agency is involved with the operation or management of Funding Circle.
This further lending commitment recognises the contribution that non-bank channels, such as Funding Circle, can play to help ease the flow of finance to businesses.