Lender sets out plans to lend £100m to Northern SMEs by 2020
Small business lenders Iwoca is pledging to lend £100m to micro and small businesses in the North of England by 2020.
The alternative finance provider is making the pledge in response to the withdrawal of credit facilities for small businesses by the UK’s banks, which it says has been most acute in the North.
According to data collected by UK Finance, the value of lending – loans and overdrafts – for Small and Medium Enterprises (SMEs) in the North of England has contracted by 14.3%, compared with the national average of 9.5%, over the past three years. The North West is the worst affected region, suffering a contraction of 15.3% in three years.
With 45,000 transactions since its launch in 2012, iwoca is one of the fastest growing business credit providers in Europe. iwoca has issued over £350 million to more than 15,000 businesses across the UK, Poland, and Germany.
Christoph Rieche, Co-founder and CEO of iwoca, said: “Micro businesses are the powerhouse of the UK’s economy. Even though they employ less than 10 people, they account for 96% of the UK’s 5.5 million businesses, 1-in-3 private sector jobs and 20% of all economic output. While these businesses have been feeling the pinch, large corporations and consumers have enjoyed record high levels of access to capital. In light of the continued lack of action by the banks to increase access to finance for this sector of the economy, iwoca is pledging to lend £100 million in the North of England by 2020.
Rieche continued: “The banks claim that small businesses are simply not interested in credit products. In reality, the banks discourage these businesses from taking finance through lengthy and cumbersome application forms, and rigid and unfair lending criteria. iwoca understands the needs of small businesses. That’s why our applications are simple and straightforward, and we have built technology to make faster and fairer lending decisions, breaking the barriers small businesses face to accessing finance.”
