The announcement is the latest in a line of successes for Funding Circle, which secured a record breaking amount of venture capital investment this year. In May, the company sealed a $150m Series E building on a $65m Series D in July 2014 and made it into the record books for becoming the fifth largest round in British history.
Real Business spoke to Funding Circle CEO Samir Desai at the time and he said that the aim of Funding Circle is to help established small businesses to expand faster and at a lower cost than the options they have .
He explained that the government and regulators have been a big support to help the company develop, and added: The government has introduced a new regulatory regime and has also committed 60m to lend through our marketplace in the UK.
With that in mind, Funding Circle has partnerships in place with Camden and Kingston upon Thames, while the new deal with Lambeth Council marks it the third local authority in London to sign up. Additionally, Lambeth is the 16th local authority in the UK to sign up and more than 5.85m has been lent by them collectively to date.
It means the council will begin lending money directly to businesses in Lambeth via Funding Circle, using the online P2P marketplace alongside other existing investors.
The launch of the Local Business Lending Partnership comes as the council looks to improve the opportunities companies in the area have to secure finance, as well as enhancing economic growth and employment.
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This is an innovative way to provide local businesses the support they need to grow and improve,” said Jack Hopkins, Lambeth cabinet member for jobs and growth.
“We want Lambeth to be a borough where businesses can thrive, boosting the local economy and creating more jobs and opportunities for our residents. Funding Circle has been proven to work and Im excited that were signing up to create more choice for business and deliver tangible benefits to Lambeth.
2010-launched Funding Circle has so far seen over 750m lent to more than 9,000 small businesses nationwide. Companies are eligible if they have a been trading for more than two years and have a turnover of at least 50,000. Once listed, investors can visit the marketplace to decide which businesses they want to invest in.
Natasha Jones, communication manager, Funding Circle, added: Were very pleased to have a further London borough council sign up to our Local Business Lending programme.
London businesses are some of the hardest working in the UK and deserve fast and fair access to finance to support their growth. Every business that takes a Funding Circle loan increases their headcount by approximately three people, so we believe this partnership will really help to boost the Lambeth economy.