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Funding Circle



Funding Circle is a P2P (peer to peer) business lender. It is debt funding for borrowers, which is secured in some cases depending on a range of factors like size and purpose of the loan. As an investor you are the lender giving money to the borrower.

Key facts and figures

Launched: 2010

Minimum investment: £20

Minimum term: Six months, but can buy/sell loan parts for less

Requirements to invest (for individuals): Must be a permanent resident of the UK, over 18 and have a UK bank or building society account. Must also pay tax on earnings. LLPs, limited companies and public bodies are also eligible to invest.

Cumulative volume lent: £298,189,040

Type of borrowers: SMEs  

Money lent in last 12 months: £442,491,500

P2P Market share % over last 3 months according to Liberum AltFi Volume Index UK: 21.01%

Returns (according to Funding Circle 26 June 2015)

Risk Band

Minimum bid rate

Estimated Bad debt rate

Estimated return after fees and bad debt, but before tax





















  • In most cases interest is earned is paid on a monthly basis but accrued daily.

Getting started

  • Register online via the Funding Circle website


  • Investment on Funding Circle happens by auction. As an investor you bid on loan requests with the amount of money you want to offer the business and the gross interest rate you set for them to pay you back.

  • Bids can’t be withdrawn, but can be knocked out by other investors offering lower rates.

  • Successful bids become “loan parts” aka your share in the overall loan. You can also buy and sell loan parts.

  • Can manage account online all the time.

Getting money on the platform

  • Use debit card or online transfer to get money into your Funding Circle account.

Do investors get a choice in who or what they invest in?

  • Yes, Funding Circle allows automatic or manual lending by investors (discussed below).

Investing your money

  • Automatic is suited to those with less time, who are happy to invest by risk band, and want to lend to new and existing loans. You use their tool to select gross interest rate, diversification % and risk bank.

  • Manual lending lets you choose by looking at business details including risk band, region, sector, the business’ financials and reason for loan.

Monitoring your account

  • Funding Circle’s account summary lets you keep track of your interest earned to date, the loans you’re bidding on, the businesses you’re lending to and more.

Understanding the risks

  • Each business listed on the Funding Circle marketplace has passed a three-stage credit assessment process. They are all established and creditworthy, and will have typically been trading for 10 years.

  • Every business that passes the credit assessment is given a risk band to guide you on their relative strength, from A+ (representing the lowest risk) through to C-.

  • Estimated bad debt rate is listed in the table above.

Withdrawing money

  • Can withdraw funds not loaned to a business at any time to your bank account, which takes between 1-3 working days.

  • Can sell loan parts early, subject to a 0.25% "Sale Fee" based on the principal amount remaining on the loan parts you sell. Can sell using autosale (selling a portion of your account by amount (£), or individually, by choosing the individual loan parts you want to sell.

Other interesting facts and figures

  • Outstanding loans: £9,305

  • Number of loans made since launch: 11,255 (from Funding Circle 30 April 2015)

  • Number of active investors: 39 000+

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