Finnish peer-to-peer lending platform Fellow Finance has launched a new SME lending product.
Fellow Finance claims to have become the first platform in Northern Europe to offer financing solutions for both consumers and companies. Finland’s peer-to-peer lending space is growing fast, with Fellow Finance and rival Fixura having lent close to €100m between them, according to the Liberum AltFi Volume Index Continental Europe. Fellow Finance’s growth in recent times has been especially pronounced. The platform has exhibited a growth rate over the past 12 months of 247.88%.
The expansion into SME lending is true to form for Fellow Finance, which has been aggressively building out its offering over the past year. The platform opened its doors to investors from across Europe in October 2015, to Japanese investors in December, and to Polish borrowers earlier this year. It is now open to investors from 35 different countries. Fellow Finance is backed by a Helsinki Stock Exchange-listed finance group by the name of Taaleritehdas, which invested €2m in the company in May of last year.
Fellow Finance’s CEO Jouni Hintikka says that Finland’s new Crowdfunding Act, which will come into force within the next few weeks, will improve investor protections and help to broaden the range of options available to small businesses.
“Crowdfunding is an excellent additional financing channel for companies in addition to bank financing and public channels.” Said Hintikka. “It allows SMEs to apply for market-based financing from investors in a light, flexible way, which has earlier only been possible for large-scale companies in the form of bonds. The new legislation offers a good opportunity to develop an alternative financing market for SMEs, which has already radically changed the financing of the entire SME sector in the United Kingdom and the United States.”