Looking back on the last three months: October – December 2018 review

Happy New Year! As we look forward to what 2019 has in store, we wanted to take a step back and celebrate what investors like you have achieved. As part of this, last week we updated our statistics page with our lending and performance figures up to 31st December 2018. Read on to find out more.

You’ve helped a record number of small businesses grow

Between October and December last year, investors lent £680 million to small businesses across the UK, US, Germany and the Netherlands; bringing the total lending for 2018 to approximately £2.3 billion.

In the UK alone, more than £440 million was lent to UK small businesses between October and December. Alongside 79,000 investors, in 2018 you lent more than £1.5 billion to UK businesses. When you remove repayments received this year from that figure—what we call net lending—you have provided approximately £725 million of new funding to businesses all over the UK, an incredible achievement!

More of our key lending figures can be seen below:

You help all types of businesses from all over the UK

By lending through Funding Circle you make a huge difference to all kinds of businesses throughout the UK. With your help they’re able to grow, create jobs, develop new products and support local communities. Below is a breakdown of the sector and location of the UK businesses currently accessing finance through the Funding Circle platform.

 

An update from our Chief Risk Officer

In December our Chief Risk Officer, Jerome Le Luel, provided his insight into how the macroeconomic environment has impacted loan performance in the markets Funding Circle operates in, and what we have done to help ensure you continue to earn attractive returns. In the UK, loans taken out since 2012 are projected to deliver returns of between 4.7 – 7.3% per year, after fees and bad debt.*

Although the economic environment for small businesses in the UK remains strong, the outlook for consumer credit in the UK has worsened in recent years. This has impacted a small population of loans in our higher risk bands who can be more susceptible to shifting trends in the consumer credit environment. These headwinds are reflected in the projected returns for our 2016 and 2017 cohorts, the most recent of which can be seen on our statistics page. You can read Jerome’s update in full here.

We’re excited for the year ahead

We’re looking forward to what 2019 will bring. Following our public listing on the London Stock Exchange last year, we believe we’re in a strong position to help you lend to more small businesses than ever before, earning an attractive return while helping the UK economy to grow. Remember, by lending to businesses your capital is at risk, and your funds aren’t covered by the Financial Services Compensation Scheme.

Enjoy lending,

The Funding Circle team

*Projected returns for loans taken out in the UK between 2012-2018, as of 31st December 2018. The projected annualised return shows the return, after fees and bad debt, that loans are currently estimated to achieve. Loans are shown by the year they were taken out. The return is calculated by combining the actual annualised return received to date, and our latest return estimates, including expected recoveries, for the remaining term of loans that have not yet been fully repaid. Past performance is not a guarantee of future returns and by lending to businesses your capital is at risk.

Jack Pritchett

Senior Communications Manager