Funding Circle plans to focus on embedded finance this year, after announcing its exit from retail peer-to-peer lending.
Lisa Jacobs (pictured), chief executive of Funding Circle UK, told Peer2Peer Finance News that the company is now transitioning away from single products to become a multi-product platform.
She said Funding Circle is planning to launch more products and focus on embedded finance through its partners, as well as its FlexiPay loan, a buy-now-pay-later flexible payment facility launched in September, and its API lending as a service in the US.
Jacobs said the lender will continue to refer small businesses it cannot help to its panel of around 25 third-party lenders it calls ‘marketplace lenders’.
“I think what we’ve done in the last decade has been remarkable and we’re proud of what we’ve achieved there, but looking forward I get more excited,” Jacobs said.
“What I laid out today is our new medium-term plan, which is focused on three things, firstly attracting new borrowers through direct marketing, making the most of the tailwinds in terms of the digitisation we’ve seen in the pandemic, but also from embedding with partners.
“We have two partners and we’ll continue to grow that, we see that as a really important distribution channel going forward. In the US we’re working with partners to build more integrated partnerships so that’s lending as a service with regional banks, there’s thousands in the US, which is very different from the UK.
“Or businesses with a very large small- and medium-sized enterprise customer base will partner with us so they can offer their customers the same slick process we offer and they can utilise our technology and underwriting capabilities to do that.
“The second pillar is saying yes to more small businesses, in that we will be maximising the opportunities from our new originations platform to create much more personalised journeys and we will be working with more of our marketplace lenders. Where we can’t support small businesses, we will refer to third parties to make integrations even better.
“And we will also be expanding our product range we offer. Today we have our first super prime loan in the US business.
“And the one I get the most excited about is being number one in new products, we will launch new products where we have great capabilities and think where we can build market leading positions.”
Jacobs put Funding Circle’s increasing profits down to growing loans under management, being tight on costs, its loanbook performing better than expected and rising revenue, which was driven by higher demand due to the government loan schemes.