The latest statistics published by the Peer-to-Peer Finance Association (P2PFA) unveiled that the peer-to-peer lending industry contributed more than £1 billion to the UK economy in the second quarter of 2018.
The P2PFA says, “small and medium-sized businesses make up approximately half of the UK’s turnover and half of all employment, yet continue to face difficulties accessing finance through traditional channels”.
The P2PFA data also indicates that after the vote in 2016 for the UK to leave the European Union, the number of lending by the banks to small businesses dropped significantly, turning negative in the last quarter of 2017 (-£74 million). However, the fall in lending from banks has not hindered the number of SMEs and start-ups from growing, in fact, peer-to-peer lending has inspired and encouraged entrepreneurs, as it allows them to achieve growth and sustainability for their business, which they once were not able to foresee having been refused funding from the banks, hence the rise of alternative finance providers such as invoice financing companies.
The rise of peer-to-peer lending is a preferred choice for entrepreneurs and small businesses in today’s economy because the process enables them to get approval and receive funds quickly.
In today’s economic climate, we are constantly experiencing change. New and existing entrepreneurs are boldly competing with big conglomerates that monopolise market share and dominate specific sectors. However, the adapting and emerging business owner of the digital world we live in today is stepping up to the demand and interest of consumers that are continuously looking for something innovative and accessible, whether it be an eco-friendly clothing boutique, a bustling coffee house where professionals can spend the day working from their laptops, new ways to shop, tech savvy gyms or a pop-up restaurant.
Creative and ambitious entrepreneurs now see a way forward to make a mark in the business world, without having to face restrictive barriers at the banks, and peer-to-peer lending has opened a gateway for them to get one step closer to reaching their existing or start-up goals. The role of peer-to-peer has played a key role in establishing SME growth.
Alex Oritogun, Funding Specialist at Populous World, says, “the rise of peer-to-peer lending is a preferred choice for entrepreneurs and small businesses in today’s economy because the process enables them to get approval and receive funds quickly. Our clients that seek finance often need funding in a short period of time, and our platform is able to deliver a quick time scale with less barriers, compared to the banks”.
Peer-to-peer lending is rapidly evolving as an important source of finance. Invoice financing companies implement a form of P2P lending that is now a preferred choice for small businesses and entrepreneurs, providing the option to obtain capital out of receivables, and unlocking up to 95% of the value of invoices.
Populous World is an invoice discounting platform that provides capital off of unpaid invoices, and recognises that business failure is most commonly a result of poor cash management. Populous World has created a global marketplace to bring together invoice buyers (investors) willing to pay the invoice sellers’ receivables (borrowers) at a discounted rate.
For more information about our invoice discounting platform and how we can help unlock the cash flow your business needs, contact: [email protected]