The study is entitled “Understanding Alternative Finance” and has been co-authored by the University of Cambridge and Nesta. The report has already drawn comment from a number of the nation’s leading platforms. We’ve summarized the highlights below:
Cumulative funding will more than double this year – from £0.7bn in 2013 to approximately £1.7bn in 2014
Average amounts raised varies dramatically depending upon sub-sector. The average equity crowdfunding raise was around £200k, peer-to-business raises averaged out at £73k and the average consumer loan stood at £5k.
The same can be said of average investment amounts. The average amount invested in the peer-to-business space was £8.1k, £5.6k in the consumer sector and £5.4k on equity crowdfunding platforms.
Some interesting findings were unearthed in regard to public awareness. Of the 2,000 consumer surveyed, 58% were aware of the existence of alternative finance platforms, but just 14% had actually made use of one of them as a means of investing. Roughly 60% of respondents stated that they would be “unlikely” or “very unlikely” to begin or continue to use the platforms. Risk and security were the most commonly cited concerns.
44% of SME borrowers – a most pertinent area of interest at the moment – knew about alternative finance in one form or the other, and yet just 10% had actually attempted to use a platform in order to secure funding. The reasons for this inactivity were: not needing finance (77%), being capable of accessing finance elsewhere (14%) and not knowing enough about the providers (9%).
These are but a handful of the many and various insights available within the report – which we’ve made available to download in full by following this link.
