iwoca, a European largest small business lenders, is pledging to lend £100m to micro and small businesses in the North of England by 2020.
The alternative finance provider is making this pledge in response to the withdrawal of credit facilities for small businesses by the UK’s banks, which has been most acute in the North.
According to data collected by UK Finance, the value of lending (loans and overdrafts) for Small and Medium Enterprises (SMEs) in the North of England has contracted by 14.3%, compared with the national average of 9.5%, over the past three years. The North West is the worst affected region, suffering a contraction of 15.3% in three years. In Manchester, the contraction has been even more dramatic, declining 22.8% over the period, which is twice the contraction experienced by London at 11.4%, also according to UK Finance.
Of the £100m pledge that iwoca is announcing, £15m is for Manchester alone.
Led by co-founders Christoph Rieche, CEO, and James Dear, CTO, iwoca is building technology that makes credit available to small businesses quickly, providing access to £1,000-£150,000 directly through the website and through partner integrations with its Lending API.
With 45,000 transactions since its launch in 2012, the company is one of the fastest growing business credit providers in Europe, having issued over £350m to more than 15,000 businesses across the UK, Poland, and Germany.