ThinCats, peer-to-business lending platform, has hit a major milestone as it surpasses £100 million in loans lent to businesses.
The alternative finance industry is now responsible for over £1.3 billion of loans to over 7000 SMEs. As it passes the £100m milestone, ThinCats has highlighted the top sectors that the platform has lent to. This includes manufacturing (17.4%), wholesale and retail trade (13.7%) and construction services (10.2%). According to AltFi Data ThinCats has a market share of the entire alternative finance market of 1.71%.
“2014 has been a record year of growth for us, and ThinCats couldn’t have asked for a better fourth birthday present than hitting the £100million milestone. Nevertheless we have always been a forward looking company, and with pension flexibilities and the first peer to peer ISA now just over the horizon, this year is set to be an exciting one.
“From April, savers over the age of 55 will be able to access their pensions freely, and ThinCats’ partnership with SIPPClub and other initiatives mean we are already well versed in allowing people to secure a regular retirement income through peer to peer whilst maintaining growth in a tax efficient wrapper. The reforms are likely catapult the sector into the global limelight in 2015.
“Our national network of expert loan sponsors behave like traditional bank managers getting to know borrowers and providing support and advice whilst they vet all of our loan applications. We are particularly pleased to be supporting the manufacturing sector which is crucial to the economy. Our investors are also keen to support businesses that make a real difference as shown by the substantial number who have invested in loans to help them grow. Furthermore, genuinely supporting UK SME’s across a range of sectors gives investors the ability to spread their investments.
“Wholesale and Retail Trade and Constructions Services have remained popular, however loans to Research and Scientific services are on the increase (7.2%). We give investors access to the largest secured peer-to-business loans on the market3, whilst producing an average return of over 9%.”
ThinCats was founded in 2011 by Kevin Caley, Peter Brown and Paul Meier. The minimum loan size on the platform is £1,000 and the average loan size is £320k, above the industry average of £72k (according to NESTA UK Alternative Finance Report, 2014). 90 lenders make up the average ThinCats loan, compared to an industry average of 796 and £55.5k is invested by the average ThinCats lender, far more than the industry average which is between £1000-£5000 per loan.
In February of this year ThinCats forged a partnership with a West Midlands-focused co-operative business loan fund. BCRS Business Loans now distributes funds to SMEs throughout the Midlands via the ThinCats platform. Also in February, ThinCats announced that it had struck a deal with ESO Capital Group, a European special situations investment management group. The deal involves the underwriting of a series of larger deals originated via the ThinCats platform. ESO will initially deploy between £20m and £50m through the platform. We had previously reported that the platform was looking to bolster lending volumes and we suggested that they might partner with an institution. These two partnerships will have had a significant effect on the lending volumes and not only will they have helped ThinCats reach the £100m milestone but will help secure volume going forwards.
Join AltFi for its third annual Alternative Income Forum, exploring closed-ended funds (investment trusts) specialising in generating an income using alternative assets such as specialist finance, P2P lending, direct lending, asset leasing and more. Hear from the leading investors and fund managers in this rapidly growing market.