Spelthorne Borough Council and Funding Circle today announced the launch of the Local Business Lending Partnership.
Spelthorne Borough Council and Funding Circle today announced the launch of the Local Business Lending Partnership, a pioneering new scheme, to stimulate local economic growth and employment through improved access to business finance.
As part of the scheme, the Council will lend up to £300,000 directly to businesses based in Spelthorne using Funding Circle, the UK’s leading online marketplace for small business loans.
The Council will join thousands of British people already lending their money to small and medium sized businesses across the country. The government-backed British Business Bank and 11 other councils across the country (including Newcastle County Council, Camden Council and Nottingham County Council) have also signed up to lend money to businesses through Funding Circle.
This pilot scheme will help realise the growth potential of Spelthorne businesses that are currently being stifled by poor access to finance. Council partnerships with Funding Circle have proven to be an effective way of unlocking business growth at a local level. 77 per cent of the businesses who have borrowed through Funding Circle would chose to return to the marketplace over a bank, demonstrating the appetite for fast, fair and transparent access to finance.
Cllr Colin Davis, Cabinet Member for Economic Development, said: “We are delighted to be able to work in partnership with Funding Circle to offer this opportunity. Local businesses are fundamental to the local economy stimulating economic growth and employment. This Council is therefore committed to supporting local businesses wherever possible for the benefit of our residents.
This new partnership will enable local businesses to have greater access to funding independent of banks, and a chance to work together in collaboration with this Council, giving them every available opportunity to prosper. I am very proud to be able to enter into such an arrangement and hope that it will prove beneficial for everyone involved.”
Natasha Jones at Funding Circle said: “The growth of small British businesses has been hampered for some time now by a cumbersome traditional lending system. Spelthorne Borough Council has recognised that online marketplaces, like Funding Circle, can help local authorities to play a direct role in supporting business growth in the local area. We are really looking forward to working together to ensure that Spelthorne businesses are able to access the finance they need to grow and prosper, and hope to be able to establish many more partnerships with other local councils in the future.”
Launched in August 2010, Funding Circle enables businesses to access finance independent of their banks, whilst at the same time British people can earn attractive returns. The process sidesteps the high street banks with businesses receiving finance within a couple of weeks compared to up to three months for a traditional bank loan. To date, more than £540 million of loans have been lent to over 8,000 small businesses across the UK. To be eligible, businesses must typically have a minimum turnover of £50,000 and have been trading for at least two years.
Once businesses pass Funding Circle’s credit assessment processes, their loan is posted on the marketplace. From here, investors choose which businesses to lend to. Investors can bid small amounts, from as little as £20, on lots of different businesses to spread their risk.
For more details or to apply for a business loan visit www.fundingcircle.com or call 0203 667 2245.