Funding Circle
| Funding Circle | |
|---|---|
|
|
| Country |
 Germany
|
| Seat | Bergmannstrasse 72, 10961 Berlin |
| legal form | GmbH |
| founding | 2010 |
| Website | www.fundingcircle.com/de |
| management | |
| Corporate management |
Pauntea Morshedi, Alexander Linden |
Funding Circle is a listed, global online broker of corporate loans for small and medium-sized enterprises (SMEs). Funding Circle has brokered over 9.5 billion euros to over 77,000 companies via the online loan marketplace since it was founded in 2010. The financing is provided by institutional investors as well as over 85,000 private investors worldwide . Funding Circle was the first online provider of corporate loans via peer-to-peer credit in the UK and is now also active in the USA (since 2013), Germany (2014) and the Netherlands (2014).
Business model
Funding Circle is an online marketplace where private and institutional investors lend money to small and medium-sized enterprises (SMEs). Funding Circle carries out the risk assessment, loan brokerage and payment processing, as well as the repayment of the loan, including receivables management . Like other online loan platforms, Funding Circle intends to use automation and a digital application path to process the process for the borrower as simply and quickly as possible than is usual with banks.
For borrowers
German companies can use the platform to apply for installment loans ( annuity loans ) between 5,000 and 250,000 euros for a maximum term of 60 months. The interest rate (from 1.69 percent) depends on the respective risk class . The exact conditions ( interest rates and terms ) differ in the different countries in which Funding Circle is active. In contrast to what is customary with banks, Funding Circle allows you to repay the corporate loan early at any time without additional costs.
A company's financing request is submitted to Funding Circle using an online form. All documents required for credit checks can also be uploaded there. The following documents must be submitted in Germany:
- Annual financial statements for the last two years ( balance sheets , profit and loss accounts ),
- Current business reports (no more than two months old, including lists of totals and balances),
- Business bank statements for the last three months.
After all the necessary documents have been submitted, the credit check begins. According to Funding Circle, a loan offer can be made after just 24 hours. The amount should be paid out within seven days.
For investors
The loans brokered to companies come about through private or institutional investors. German private investors can use crowdlending to invest from € 100 and a maximum of € 5,000 per project. The net returns currently forecast by Funding Circle are between 5 and 7% p. a. Investors can obtain the following information about the companies on the public online marketplace:
- Loan amount, risk class and duration of the individual projects
Registered investors also receive further information on the company, financial figures and financing purpose.
Risks
In contrast to a savings account or fixed-term deposit offers, returns are not guaranteed with Funding Circle, i. H. Investors can lose money if the underlying loan defaults or defaults. Funding Circle limits this risk by performing a credit check based on a specially developed algorithm . Based on a large number of data, the algorithm carries out the assessment and assigns a risk class to each project (A + to E, E stands for the highest risk). The results obtained are then checked by experienced credit analysts . An offer is made based on this.
In 2018, Funding Circle subjected its portfolio in Germany to a stress test in order to better assess the risk for investors in the event of a recession . According to Funding Circle, investors would receive a positive return even in the event of a recession.
history
Funding Circle was founded in London, UK in 2010 in response to traditional banks' underserving of small businesses as a result of the financial crisis . Funding Circle has also been active on the German market since taking over Zencap, a company founded by Rocket Internet in 2014 . Funding Circle Deutschland GmbH is based in Berlin. Funding Circle has been listed on the London Stock Exchange since October 2018, with an initial valuation of £ 1.5 billion. The shares were valued at 440 pence each. Despite Funding Circle's status as a “unicorn” in the startup area, the price achieved in the IPO fell short of expectations overall.
Investors
According to its own information, Funding Circle is one of the best capitalized loan platforms in the world. Since 2010, around 630 million euros have been collected from investors worldwide. Investors include venture capitalists from Facebook, Twitter, Skype and Betfair, and they collectively manage over $ 5 trillion.
Public and financial institutions investing in small business finance through the Funding Circle platform include KfW , the European Investment Fund , British Business Bank and life insurer Aegon .
literature
- Study The Economic Impact of Lending via Funding Circle by Oxford Economics on behalf of Funding Circle, June 2018
Web links
- Official website of Funding Circle
- Funding Circle Blog
- Company profile on www.gruenderszene.de
- Customer rating at eKomi : 4.8 / 5
Individual evidence
- ↑ The online marketplace | Funding Circle. Retrieved November 26, 2019 .
- ↑ Patrick Collinson: Peer-to-peer lending and saving: Making everyone happy. In: The Guardian. Retrieved August 28, 2010 .
- ↑ Funding Circle boss Samir Desai: A Brit wants to provide Germany's companies with online loans. Retrieved May 27, 2019 .
- ↑ Funding Circle: Our Statistics. In: www.fundingcircle.de. Retrieved February 18, 2019 .
- ↑ Funding Circle: Funding Circle loan portfolio passes stress test with top marks. In: press portal. Retrieved February 12, 2019 .
- ↑ Fintech: Funding Circle loan marketplace collects 94 million euros. In: WiWo founder. January 12, 2017, accessed May 27, 2019 .
- ↑ Funding Circle: About online marketplaces for corporate finance. In: www.fundingcircle.de. Retrieved February 13, 2019 .
- ↑ Christina Kyriasoglou: Fusion sealed - Funding Circle and Zencap merge. In: www.gruenderszene.de. Retrieved February 12, 2017 .
- ↑ London Stock Exchange: FCH FUNDING CIRCLE HOLDINGS PLC ORD 0.1P. In: London Stock Exchange. Retrieved February 13, 2017 .
- ↑ Hasan Chowdhury: Funding Circle set to become one of the UK's leading fintech 'unicorns'. In: The Telegraph. Retrieved September 3, 2018 .
- ↑ Naomi Rovnick and Camilla Hodgson: Funding Circle prices at bottom end of narrowed IPO range. In: Financial Times. Retrieved September 28, 2018 .