Funding Circle co-founder and CEO Samir Desai CBE
Funding Circle sees lending growth and higher losses in 2019
The SME lender had a tough 2019 in the stock market, with losses increasing over the year.
Funding Circle, the SME lending platform, announced today that a record £1.6bn was lent to small businesses through its platform in 2019 according to its full year results released today.
Losses for the company increased to nearly £85m in 2019 from just under £50m in 2018, this loss includes £34.3m that was put towards remodelling the business in Germany and The Netherlands.
According to the full year report, roughly 80,000 small businesses accessed funding through the platform by the end of 2019.
The SME lending platform also said that in the last quarter of 2019 “net lending to small businesses through Funding Circle was higher than the major UK banks combined.”
Revenue for the small business lender topped £167.4m in 2019, an 18 per cent increase on 2018 (£141.9m).
Following a tough year, it was reported that the lender’s cash and cash equivalents has more than halved from £333m in 2018 down to just £164.5m in 2019.
The lenders put the huge decrease down to “the introduction of the new investor products” where they reportedly injected £117.7m.
The report also revealed that Funding Circle’s operating costs jumped to just over £252m, from £192.7m in 2018, with a large chunk of that being spent on marketing.
Despite the apparent doom and gloom, Funding Circle has nearly doubled its assets from £450m in 2018 to nearly £1bn in 2019.
Samir Desai CBE, CEO and founder of Funding Circle, said: “The actions we took in 2019, in response to the uncertain economic outlook, reduced growth but improved investor returns and were the right response for the long-term benefit of the company and our customers.”
Funding Circle is likely to be one of the many companies that benefit from the announcement in the Budget yesterday that the Government will immediately be implementing several safety nets to ensure SMEs stay afloat in this current period of economic turmoil.