A fintech-led, alternative lending platform has been built to serve the Community Interest Company ExcludedUK and has launched today (10th July) to support businesses not eligible for Government Covid financial support.
The Small Business Interruption Loan Service (SBILS) launches in response to the Chancellor’s summer statement after no announcement was made to extend the Government’s criteria for sole traders and SME support.
The SBILS platform is a peer-to-peer lending platform allowing businesses to gather financial support from a ‘crowd’ identified by them with support from SBILS.
It allows SMEs a platform to pool together resources from their network including friends, family, customers, business partners and suppliers.
The number of UK businesses and sole traders not able to qualify for Government support stands at approximately 3 million people. This includes the newly self-employed, those self-employed that earn over £50,000 and Directors paid in dividends.
Tens of thousands of those affected have joined the non-profit non-governmental organisation, ExcludedUK CIC - a support network which now has an all-party parliamentary group of more than 200 MPs.
The alternative lending platform is expected to help more than 50,000 of the 3 million excluded businesses.
Anneka Hicks, founder of ExcludedUK, said:
“ExcludedUK represents over three million UK taxpayers excluded from the Government support schemes such as the newly self-employed and directors of small businesses. Many of these people are now facing significant financial hardship, having found themselves ineligible from grants and schemes put in place that should have been able to help them sustain their income and prevent the closure of their businesses, or the loss of their livelihoods during the Coronavirus Pandemic.
“We are very happy to work alongside JustUs to present SBILS as an innovative solution that offers sole traders and SMEs an alternative at a time when Government isn’t providing the needed financial support. It will allow SMEs to source support from their own networks but with the necessary security for all those involved. We hope that the platform brings much needed fresh hope to thousands of businesses to get them back up and running successfully.”
Fintech efficiencies versus legacy banks in UK lockdown
The platform has been provided by P2P lender JustUs who is working alongside BBFTA - a Covid-Response Fintech Taskforce. The involvement of fintech companies, including digital identity and money laundering checks, means banking accounts can be opened and applications made, in minutes.
Once funded, applicants will also receive funds within 24-hours as fintech sector efficiencies yet again highlight issues still faced by legacy banks whose manual document processes result in delays in account setups and meant many businesses couldn’t easily access traditional bank support during the Covid lockdown.
Lee Birkett, founder of JustUs P2P platform and SBILS said:
“We’ve worked closely with ExcludedUK and the fintech task force to utilise lending solutions we have established as we recognise how many businesses, which were highly successfully before the pandemic, have found themselves struggling through no fault of their own.
“Many of these excluded businesses have extremely bright futures but have just had to navigate the trickiest waters that no one never expected.
“Using a peer network is a very viable solution for tens of thousands of businesses. However, we are still urging the Government to reassess its criteria. It should be acting as the main financial lifeline for SMEs, with platforms such as SBILS, then being a further support stream. Currently, for many businesses that found themselves non-eligible, it is their only option, which is an issue that we still want Government to address.
How to apply and terms
To apply, businesses can from today (10th July) download the Moneybrain app and apply. Following an application review, if a request is successful the SBILS teams help a business build a loan request campaign. Businesses then use the materials and support provided by SBILS to source funding from their network, when 100% funded, money is received within 24 hours.
No repayments are required for the first 12 months. The interest rate from month 1 to 12 is 3.00% p.a. which is rolled up. The interest rate from month 13 is between 6.00% and 8.00% depending on the loan amount. Maximum term is 60 months and there is a completion fee of 2.00%.
Loans provided by an individual between £50,000 and £250,000 will be subject to a company debenture order ensuring it is recognised by creditors should liquidation or any other insolvency process be undertaken by a company whilst the debt is outstanding.
Loans over £250,000 will also be an asset or property-backed loan.
For more information visit www.SBILS.co.uk.
Who is involved and quick links
ExcludedUK - A Community Interest Company (CIC)
JustUs Platform – used for the SBILS Loans Scheme
Lem Verify – for Digital Identity & Money Laundering
Railsbank – for Digital Faster Banking Payments
EML Payments – for Digital Payment Cards
Moneybrain - Fintech app
Fintech Taskforce (BBFTA) - Chaired by Barry James
Notes to editors:
SBILS is an electronic system in relation to lending. SBILS is a trading style of eMoneyHub Ltd. Authorised and regulated by the Financial Conduct Authority.
Please visit the newly launched SBILS website - https://sbils.co.uk/
Full terms and conditions are here - https://www.sbils.co.uk/docs/terms-and-conditions.pdf