Funding Circle, a peer-to-peer lending platform emanating from the UK and now servicing Germany, the Netherlands, and the US, have their sights set on entering the Canadian market. The first to offer such a P2P platform for business lending in the UK, Funding Circle continue to help SMEs fight against unfavourable financing terms set by banks. Canadian operations are set to be launched from a Toronto-based office in the latter half of 2019. 

Mirroring what Funding Circle noticed across their European markets before entrance, Canadian SMEs have reported financial constraints such as credit rationing and higher costs of borrowing. The operation will be led by former UK Commercial Strategy Leader Tom Eilon who stated:

“We have been evaluating options for expansion over the last year. Canada’s stable, growing economy coupled with good access to credit data and progressive regulatory environment made it the obvious choice. The most important factor though was the clear need for additional funding options among Canadian SMEs. We are looking forward to officially launching later this year and supporting Canadian SMEs to access the finance they need to grow, create new jobs and fuel their local economies.”

Funding Circle, which was recognised among the winners in the Open Up Challenge for their adoption of open-banking practices in the UK, uses data unlocked by open0banking (or PSD2) to help businesses better manage their finances and improve eligibility for finance. Given the Canadian Government has launched a consultation paper on open-banking in Canada, and the local Ontarian government has recently begun funding alternative lenders similar to Funding Circle, it seems that both the regulatory and SME landscape is primed for Funding Circle entrance.