Online invoice marketplace MarketInvoice is to receive £5m through the Government’s flagship Business Finance Partnership
Business Secretary Vince Cable has announced the second round of the small business tranche of the Business Finance Partnership programme, which will see MarketInvoice receive £5m.
The funding will be deployed through the MarketInvoice platform and channelled as working capital for British SMEs. MarketInvoice allows businesses to raise funds by selling individual invoices to a pool of investors.
“Honoured”
Anil Stocker, who co-founded MarketInvoice with Charles Delingpole in February 2011, says he is honoured to be part of the Government’s solution to the credit crisis.
“We speak to business owners every day that have struggled to get the finance they need to grow, despite having well-run companies with vast potential. This support from the Government means we can reach out to even more firms left isolated in the current financial services environment.”
Since MarketInvoice was founded, the company has channelled almost £50m of finance to hundreds of British businesses.
“Today’s announcement reflects the importance of the job we are doing, and the progress that we’ve made,” adds Stocker. “This represents a key landmark in the shift towards a new, more efficient financial landscape, in which funding the nation’s businesses is the responsibility of a diverse range of providers, rather than a few overburdened banks. We look forward to next generation finance moving into the mainstream.”
In addition to MarketInvoice, two other lenders – supply chain finance platform URICA and mezzanine fund manager Beechbrook Capital – were also allocated funding, of £10m and £17m respectively, today.
Diversifying finance
Through the Business Finance Partnership, the Government has committed to provide £100m of funding for non-traditional lenders in order to diversify the sources of finance available to SMEs. Currently, 85 per cent of all business loans are handled by the big four banks.
The first allocation made by the Department for Business, last December, saw four other alternative lenders (Funding Circle, Zopa, BOOST&Co, and Credit Asset Management) allocated some £55m.
In total, the seven successful bidders announced under the Business Finance Partnership are expected to facilitate total lending of more than £240m to SMEs by attracting private sector investment alongside government’s funding.
Announcing the latest tranche at the Federation of Small Businesses this morning, Business Secretary Vince Cable said: “Today’s £30m announcement is an important boost for non-traditional lenders with creative and innovative solutions. It will increase competition and create a more diverse and balanced market for business lending.”