Lending to UK small businesses grew by almost 30% in the 12-month period from the beginning of July 2015, according to new figures.
However, the data – from the National Association of Commercial Finance Brokers (NACFB) – shows that funding through web-based, alternative-finance models declined in that time, despite the steady rise of fintech.
Collated from the activities of NACFB members, the figures reveal that the number of deals its brokers arranged via peer-to-peer lending (P2P) platforms was down on the previous year by 14.4% – a dip from £848m to £725m.
Meanwhile, traditional finance sources, such as commercial mortgages, have ballooned by an extraordinary 54.8% – contributing to a British SME lending climate that has outstripped the pre-recession funding record of 2007.
Buy-to-let deals alone have experienced year-on-year growth of £5bn – up by a third. Other significant growth areas include:
The NACFB also points out that, since 2013, commercial mortgage business arranged by its members has more than doubled.
Its chief executive, Adam Tyler, said: “It’s been a phenomenal and record-breaking year across the commercial finance sector.
“With the UK’s SME community showing a real appetite for growth, despite the uncertainty of Brexit, we have seen small business lending at levels above even those registered before the financial crash.”
Noting the “significant switch” that SMEs have made back to traditional forms of lending, Tyler added: “The alternative finance sector has grown at such a pace that it was inevitable that rate of growth couldn’t be sustained.
“Peer-to-peer will always have its place – but alternative forms of funding are no longer the only future. They are just one of many forms of finance available to small and medium-sized businesses.”