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By Josh Yelland

The Alternative Finance and FinTech communities appeared full of the joys of spring recently on the news that (another) one of their kind was challenging the big five banks, in terms of lending to small business.  Having recently been doing a bit of work for a colleague in the Corporate Finance team here at PKF Francis Clark, I was interested to read more and share some information with you; especially when my colleague told me that a high number of businesses are unaware of the finance options potentially available outside of the main street banks.

iwoca in the news

Forbes reported that UK Finance data had revealed that, small business lender iwoca, “provided a staggering 3,802 credit lines of the 31,014 approved by all lenders in Q4 2018, equating to 12 percent of all new business overdrafts offered and a two percent increase from the previous quarter. 

This result followed iwoca overtaking big lenders such as Santander, which has a market share of nine percent and HSBC, 11 percent. Of the big five, Barclays accounts for 15 percent, Lloyds, 20 percent and leading, is RBS with 30 percent.”

Altfi reported that “with iwoca claiming that 90 percent of the SME market has yet to hear about them and the FinTech preparing a bid to secure £10m from Pool C of the RBS Alternative Remedies Package in the coming months, [iwoca] are gearing up for a busy 2019”.

Who are iwoca?

If you are in the 90 percent of the SME market who has / had not heard of iwoca, it may be worth checking out their website to get a feel for their offering – designed around small businesses. No more convoluted forms, long waits and unfairly rigid lending criteria. Instead, we combine award-winning technology with an understanding of exactly what small businesses need, to provide you with the tools to unlock growth or plug cash flow gaps that many businesses face.”

Their website shows they have lent £795m to 25k businesses and they announced at the end of 2018 that they launched Open Banking with HSBC and Barclays.

It appears they themselves raise cash from outside investors, with an announcement earlier this year that their Series D equity round raised a total of £150m in equity and debt.

Whilst I have yet to have any direct communications with iwoca, I understand some of my colleagues in Plymouth have and as a firm we have assisted clients directly or indirectly (through Capitalise) raise funds from iwoca.

Finance in Cornwall

iwoca will not be presenting at this years’ event, however other ‘alternative finance’ providers will be, as will Capitalise – I am also hoping that ‘Open Banking’ will be covered by at least one of the presenters in the debt section.

In the interim, please contact your usual PKF Francis Clark contact to discuss a debt raise that you feel may be suited to iwoca.

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