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April 2014 -
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Alternative Financing in the UK
Nesta, the University of Cambridge and the University of California, Berkeley have carried out the first intensive, comprehensive and empirical country–level study of an alternative finance market anywhere in the world.
Alternative finance activities such as crowdfunding, peer–to–peer lending and invoice trading have emerged as a significant funding mechanism and source of capital in the UK in recent years. Meeting the capital needs of both individuals and businesses, facilitating fundraising activities for civic projects and social causes, alternative finance intermediaries have become online marketplaces where individuals, rather than institutions, work collaboratively to form capital.
As the alternative finance market continues to grow in the UK and the government looks to regulate the area, this benchmarking report offers a timely snapshot of this fledgling and dynamic sector to help understand its size, growth and the fluid development of respective segments.
This benchmarking survey reveals that the UK alternative ﬁnance market
grew by 91 per cent from £492 million in 2012 to £939 million in 2013.
Cumulatively, the overall market had an average growth rate of 75.1 per cent over the last three years and contributed £1.74 billion of personal, business and charitable financing to the UK economy. While the peer–to–peer charitable fundraising and donation–based crowdfunding still represents the largest segment with £310 million in 2013, the vitality and diversity of the alternative market is on full display.
Perhaps even more impressive than their already considerable transaction volumes, their cumulative and year–on–year growth rates are high.
SME finance and future projection
Collectively, the UK alternative finance market provided £463 million worth of early–stage, growth and working capital to over 5,000 start–ups and SMEs in the UK during the period 2011–13, of which £332 million was accumulated in 2013 alone. Based on the average growth rates of between 2011 and 2013, we can cautiously predict that the UK alternative finance market will grow to £1.6 billion in 2014 and provide £840 million worth of business finance for start–ups and SMEs.
Source: The UK Alternative Finance Benchmarking Report
Nick Clegg visits the Cartwright group following their £2m grant award -
GrowthAccelerator Is a government backed initiative to help achieve rapid growth
in smaller companies. Already 12,000 SME’s have benefited -
R&D Tax Credits
Another great government initiative much mis-
“Banks are no longer lending...” True or not, the growth in alternatives is both significant and innovative.
We review highlights from the first comprehensive study.
Alternative Finance (to Banks) reaches nearly £1bn in 2013