The platform was handed the prize for the innovative role it has played among peer-to-peer lenders.
Peer-to-peer lending platform Ratesetter has been awarded the Queen’s Award for Enterprise for excellence in innovation.
These firms were formed in the aftermath of the 2008 financial crisis as investors sought higher returns from low interest rates offered by banks, and small businesses, often ignored by traditional lenders, chased alternative forms of finance for growth.
RateSetter, founded in 2010, has originated £3.2bn of loans to individuals and businesses across the UK and generated £130m in interest for its 80,000 investors.
The platform was handed the business honour for its contribution to innovation in the sector. The firm pioneered the use of the provision fund among peer-to-peer lenders, which is a cash reserve built up by borrower fees to cover bad loans.
The firm said “to date, every RateSetter investor has received all the interest and capital that they expected”.
Ratesetter Lewis, OBE, added: “Innovation is in our DNA at RateSetter and goes to the heart of our business. We are proud to have pioneered a new concept in investing including the provision fund, which is instrumental in delivering healthy, stable returns and in making lending simple and accessible to everyone.
“Winning the Queen’s Award in recognition of this innovation is a tremendous honour for all of us at RateSetter.”
Winners of this award qualify for "outstanding achievement" in innovation, international trade, sustainable development or by promoting opportunity through social mobility.
As part of the honour, the platform will attend a royal reception for Queen’s Award winners at Buckingham Palace in June. Companies hold this award for five years, and during that time they are allowed to use its emblem on marketing materials and fly the Queen’s Award flag over its headquarters.