A new person-to-business lending platform by the name of Money&Co has been launched in the UK. It aims to improve businesses' access to finance by giving them the chance to borrow from the public, instead of turning to banks.
SMEs are still having a hard time finding funding via banks, a recent report by the Bank of England confirmed. Money&Co provides an alternative solution. Businesses that seek to borrow money can submit an application online and in 72 hours they can expect to see the lending auction go online. Auctions will be active for 14 days.
All lenders who can commit a minimum of £100 can invest in a business of their choice. Investments in individual loans start at £10. Factors like geographical location, industry, risk assessment and credit rating will help investors choose a business.
The platform will give people the chance to lend to businesses at a rate agreed upon by both parties, said businesswoman Nicola Horlick, founder of Money&Co. It allows businesses to get the capital they need while providing investors with a better return on their cash, she explained. Thus the public can contribute to UK business growth.
Horlick's idea is to open up the alternative finance sector with the new Money&Co platform and thus provide more people and businesses with an alternative to banks.
According to Horlick, it is essential for companies to have access to borrowing if they are to keep the UK's economy on the rise.
Money&Co offers a minimum loan of £50,000 and a maximum loan of £3 million. The loan period is up to five years.