LendingCrowd Predicts ‘Significant New Lending Activity’ After 2020 Sluggish
LendingCrowd has predicted “significant new lending activity” for the remainder of 2021, after recording a loss last year due to “reduced activity” amid the pandemic.
The Scottish peer-to-peer business lending platform recorded a loss of £ 1.14million in the 12 months leading up to December 31, 2020, according to its latest annual accounts filed with Companies House.
This is a slight decrease from a loss of £ 1.97million in 2019.
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“Although the company recorded a loss for the year, it was anticipated and tightly controlled,” LendingCrowd said in its results.
“The loss was due in part to reduced activity due to the Covid pandemic. The company had bank balances of £ 1.1million at the end of the year. As budgeted, lending was limited in the first quarter of 2021, but the company expects significant new lending activity for the remainder of 2021.
“This is based on new credit facilities, which are at an advanced stage of negotiation, and management’s realistic assessment of demand levels for new loans.
“Current forecasts indicate that the company may need a limited level of additional equity financing in early 2022, but directors are confident this can be controlled by increasing loan volumes, managing expenses. or, if necessary, that financing would be available from the shareholder. based.
“The key assumptions in management’s forecast are the availability of debt capital, the size and timing of borrower demand, and the availability of additional capital if needed. “
The platform began lending under the Coronavirus Business Interruption Loan Program – a government-backed lending program to support businesses during the pandemic – in September of last year. As a result, it was closed to retail investors as funding for CBILS loans is limited to institutional lenders.
CBILS closed at the end of March of this year, but LendingCrowd remains closed to retail investors as its secondary market is still temporarily suspended.
A spokesperson said the platform is assessing the situation on a monthly basis.
“We are constantly evaluating this, we will be guided by what we see and market trends,” the spokesperson said. Peer2Peer Financial News.
“We are still in the early stages of exiting the pandemic, we see that the leave regime is over and there are still a number of broader economic factors at play that we need to watch out for and that is what we are doing. take into account when evaluating our decision.
“We communicate regularly with our retail lenders to update them on status and always want to communicate that the market is temporarily suspended.”