The alternative commercial finance services market in the UK, which includes peer-to-peer lending, crowdfunding and invoice trading, is being predicted to hit £1.74 billion by the end of 2014, according to a new study conducted by the University of Cambridge and Nesta.
Furthermore, expert forecasts are now indicating that the market will reach £4.4 billion by 2015, with the report going on to show that consumer and peer-to-peer business lending are dominating the sector, with £547 million and £749 million respectively lent through the models this year alone.
By year end, it is thought that the alternative finance market in the UK will have provided more than 7,000 small to medium-sized enterprises (SMEs) with over £1 billion in business finance.
Co-author of the report Liam Collins remarked: “With bank lending to SMEs down again this quarter, it’s no wonder that alternative finance is fast becoming an important source of funding for individuals, businesses and organisations who struggle to access finance elsewhere.”
He continued, observing that the UK is paving the way around the world and it will not be long until the alternative finance market becomes that much more mainstream.
This comes after the Association of Chartered Certified Accountants’ Back in the Game report found that SMEs are increasing confident about investment opportunities in the UK and indeed the rest of the world. This is being driven by improvements in government policy and better investment environments, both of which are proving to be very positive indeed for businesses on a global scale.