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HSBC challenger Kinetic tops £2m SME loans in first three months, as competition in space heats up

HSBC launched its challenger mobile banking app Kinetic two years ago to take on the likes of NatWest’s Mettle and challenger bank Tide in the SME banking space.

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HSBC Kinetic/ HSBC

HSBC challenger bank Kinetic has lent over £2m to SMEs in its first three months as an SME lender, as competition in the space heats up.

HSBC launched its challenger mobile banking app two years ago to take on the likes of NatWest’sMettle and challenger bank Tide in the SME banking space.

The £2m milestone reached by Kinetic follows Mettle putting out figures earlier this year showing a fivefold increase in users since the start of 2021.

Tide, meanwhile, says it’s hitting seven per cent of all UK SMEs, after adding 100,000 new members in 2021. Others in the space include Starling and Cashplus Bank.

Kinetic began offering small business loans in April this year and says that it topped the £2m loan mark across April, May and June this year.

Small business founders and business leaders were primarily using the loans (33 per cent) to purchase stock, ahead of consolidating debt (28.5 per cent), followed by working capital (15 per cent), and purchasing furniture and fittings (13 per cent).

The number of small businesses is on the rise in the UK. Department of Business, Energy & Industrial Strategy figures show that the number of small businesses in the UK has jumped by 60 per cent over the past 20 years.

Kinetic also pointed to figures showing that 46 per cent of Britons are now making a second income from a side hustle, with their contribution to the economy estimated to be worth around £36bn.

Peter McIntyre, head of Kinetic and Business Banking, HSBC UK, said: “HSBC Kinetic is already helping thousands of small businesses across the UK transform the way they do business.

"With more and more entrepreneurs starting businesses or developing side-hustles, we’ve also teamed up with some great partners to take the stress out of starting and running a business. We’re proud to be putting more of the bank in customers’ pockets, by enabling them to manage their finances on their phones whenever and wherever they want.”

Kinetic, which offers loans of up to £10,000 to SMEs, said that 60 per cent of its loans are processed “within just a few moments”.

Along with loans, Kinetic also offer small business overdrafts, credit card and saving account options.

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