Fellow Finance Adds SME Loans

Fellow Finance logoFinnish p2p lending marketplace Fellow Finance now also offers SME loans.

In the service, companies can apply for financing for growth and investments from Fellow Finance’s investors.. Fellow Finance has intermediated loans for consumers through its service for 40 million EUR during a period of 12 months. Opening a financing service for companies stems from the needs of Fellow Finance customers and with the new Crowdfunding Act established legal framework for the operation has been established.

I checked the marketplace. Right now there is one loan request for 70,000 Euro at 11% interest rate, 60 month term listed.

‘We have already received requests and inquiries from our clientele for a long time about whether we could also start financing companies. Many of our customers are either current or former entrepreneurs who understand the financing challenges faced by Finnish SMEs in different phases of business. They have a strong desire to finance other entrepreneurs and offer promising projects the chance to really take off’, says Jouni Hintikka, CEO of Fellow Finance.

Crowdfunding is a way of obtaining financing for a company or project from many investors. It can take the form of a loan or shares. Fellow Finance’s crowdfunding service is loan-based crowdfunding, i.e. the investor lends money to the company with an ordinary bond. The new Crowdfunding Act in Finland will enter into force at the beginning of September, establishing rules for crowdfunding, improving investor protection and diversifying the financing market available to SMEs.

‘Crowdfunding is an excellent additional financing channel for companies in addition to bank financing and public channels. It allows SMEs to apply for market-based financing from investors in a light, flexible way, which has earlier only been possible for large-scale companies in the form of bonds. The new legislation offers a good opportunity to develop an alternative financing market for SMEs, which has already radically changed the financing of the entire SME sector in the United Kingdom and the United States’, says CEO Hintikka.

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