Funding Circle strikes a £1bn lending deal with Waterfall

The partnership is the second time Funding Circle and Waterfall have struck a deal of this size.

SME lender Funding Circle has struck a new £1bn partnership with US-based Waterfall Asset Management.

Waterfall will lend through the Funding Circle platform over a two year period alongside a wide range of investors, including banks, asset management companies, insurance companies, government-backed entities, individuals and funds. 

“We have been impressed by Funding Circle’s resilience throughout the Covid crisis and believe Funding Circle’s platform and technology will be effective in enabling investors to access this asset class and supporting borrowers in the post-pandemic recovery,” said Henrik Malmer, Managing Director at Waterfall.

The pair first set up a funding deal in 2018, also for £1bn, including a number of securitisations. 

“We are proud of our four-year partnership with Waterfall which will continue to provide tens of thousands of small businesses with the finance they need to drive the post-pandemic recovery. It’s great to see a wide range of investors leveraging Funding Circle's machine learning and technology capabilities to lend to SMEs at both speed and scale,” said Lisa Jacobs, CEO at Funding Circle.

Founded in 2010, Funding Circle says small businesses can apply for finance in an average of six minutes, with lending decisions in as little as nine seconds. In total it has lent c. £14bn to approximately 120,000 businesses globally. 

It banked a £64m profit for 2021, according to its latest accounts, following a strong bounceback during the pandemic as it become of the largest lenders of government-backed loans to struggling businesses and moved to automation in its lending after a multi-year investment in machine learning.