In your second monthly instalment, we’re analysing what happened in April — from helping over 1,100 businesses access much needed finance to Chancellor Philip Hammond praising Funding Circle in The Times. If you missed April’s Review, you can read it here.
We’ll also hear what small business owners think is in store for them over the next 12 months and find out how making small monthly contributions to your Funding Circle account could have a big long-term effect. Dive in below.
Last month, you and other investors helped create jobs, fund businesses to take new opportunities, and drive energy into the UK economy — thank you for your continued support!
April Industry News
Chancellor Philip Hammond also praised UK financial technology, referencing Funding Circle and Transferwise as ‘hugely successful British firms’ in The Times. Find out more about this and more in our round-up of last month’s industry news.
The small business community is pretty special. Not only are they doing extraordinary things on a daily basis, but these businesses are vital to the UK economy, making up 50% of GDP and 60% of private sector employment.
So, we asked their views on the upcoming election, and how Brexit and the economy are impacting their business. More than 2,300 responded and you can hear what they had to say here or read more in The Times.
These graphs show the most recent activity on the marketplace.
You’ve helped 8,599 small businesses access finance in the last 6 months…
Totalling over £616 million lent
April 2017 sector breakdown
Amount lent to each sector
April 2017 regional breakdown
Amount lent to each UK region
Small monthly contributions, big long-term impact
Making even a modest regular contribution to your Funding Circle account can have a considerable long-term effect. For example, if you start with £10,000 and set up a standing order for £100 a month, after 30 years you could have an account worth nearly £200,000.**
Reach your financial goals, whether it’s pension planning, a once in a lifetime holiday or even just a rainy day fund, by setting up yours today in just 3 simple steps.
As part of lending to businesses, a small percentage will not be able to fully repay their loan. This is known as bad debt and is a normal part of business lending. We believe diversification, where you lend no more than 1% of your total to each business, is the best way to reduce the impact this has on your return. You can diversify automatically using our Autobid tool.
Each week, we publish a list of the loans being defaulted on the Customer support section of our website under ‘Announcements.’ To see a breakdown of the loans defaulted last week simply click on loans defaulted 27th April 2017. For further information on why Funding Circle defaults loans you can read our FAQ here.
You can also read more about how our collections and recoveries process works (part one and part two) on our blog.
Up next in May, we’ll be looking at the impact your lending is having on the UK economy and bringing to life some of the businesses you’ve helped access finance.
As always, if you have any questions or comments our dedicated team are here to help. And if you have any further suggestions we’d love to hear them.
Enjoy lending, the Funding Circle team
*The current estimated return is a weighted estimate of the annual return after fees and bad debts that investors could earn from lending money to businesses seeking loans today. It is calculated by taking the gross interest rate less fees and estimated bad debts that will occur in the future for each of the last 3000 loans accepted on the marketplace. The average return is weighted by loan amount, compounded and before tax. The return is updated daily. See the full calculation here.
**Returns are at our estimated annualised return of 6.9%** (as of 6th March 2017), are compounded monthly, and are after fees and bad debt but before tax. Based on this, an account worth £10,000 with a standing order of £100 a month would be worth £199,084.63. Returns are calculated using a compound interest calculator.
This blog is a general summary, and should not replace financial advice tailored to your specific circumstances. Funding Circle is not authorised to, and does not, provide investment, tax, legal or regulatory advice. If you have any questions, please speak to your professional advisor or seek independent specialist advice.