Trade Ledger, a digital lending platform; Wiserfunding, a digital SME credit scoring platform; Nimbla, a trade credit insurance provider, and NorthRow, a remote client onboarding platform, have established a new fintech taskforce to provide a turn-key loan origination and underwriting platform that allows banks, alternative lenders and private debt lenders to virtually and digitally deploy funds to businesses during the Covid-19 outbreak.
The coronavirus pandemic has caused immediate and potentially long-lasting impacts to the UK’s economy. The sudden and profound impact on customer demand is leaving SMEs in chronic need of credit to manage their ongoing costs and may well lead to a recession over the coming months. However, even before the crisis, SMEs were struggling to access enough credit with over £59 billion in unmet lending needs.
As such, the concern of the taskforce is that, even though extraordinary measures have been taken by government to offer grants, loans and guarantees including the British Business Banks’ Coronavirus Business Interruption Lending Scheme (CBILS) funding, may not get to those SMEs that most need it – or in the timeframe needed.
The objective of the taskforce is to put a turn-key lending platform, including risk assessment, KYC and insurance capabilities, at the disposal of the industry to help alleviate the crisis and expedite the allocation of funding. The lending platform, which combines the best of technology and data integrations to digitally originate and underwrite lending to SMEs, could be used by individual lenders or, it is hoped, could form the basis of a consortium that would intermediate between multiple lenders – including private funds and the British Business Bank – and the multitude of SMEs seeking lending. The platform will be able to support any type of term loans, invoice finance and asset finance and aims to help lenders to deploy specialist loans of over £500K within days as opposed to weeks.
Martin McCann, CEO at Trade Ledger said “With the COVID-19 outbreak putting immense financial pressure on global supply chains, now more than ever, SMEs need reliable cash flow if they are to stay in business. On average, it takes around 90 days for lenders in this sector to onboard new customers and establish new credit lines. The government’s capital injection is a massive boost to an underserved market at an extreme time of need but its impact will be lost if lenders aren’t able to get these loans to their customers quickly.”
Gabriele Sabato, CEO at Wiserfunding added “We are proud to support such an important initiative at this critical time. Unlocking funds that would not be available without our support is our priority. Our risk management technology will help lenders to make the right choices and deploy funds more effectively, while at the same time making sure that SMEs are aware of the impact of the additional debt on their risk profile. We are convinced that Tradeledger, Nimbla & Northrow are the best partners to ensure the success of this initiative and maximise the value for SMEs.”
Flemming Bengtsen, CEO at Nimbla said “We are working together with our coalition partners and industry leaders to propose a government-backed scheme, specifically for SMEs, for credit insurance which will encourage them to continue to offer credit terms. The scheme will also help unlock invoice finance, supply chain finance and other working capital finance solutions by adding the backstop required to offer finance at acceptable levels for SMEs.”
Adrian Black, CEO at NorthRow added “The Covid-19 pandemic is causing massive strain on a great many businesses who urgently need to access finance. Assistance from the Government is essential and welcome but speed is critical, as businesses need funds fast and some will simply not survive long application processes. Anything that speeds up processing therefore, including rapid Know Your Business client onboarding’, deserves support and NorthRow are happy to step in and help with a flexible but compliant approach to the problem.”