Iwoca and Funding Xchange Partner to Launch Cash Advance Product for SMBs



Alternative loans

E-commerce based SMEs can apply for funding from £1,000 to £50,000 from today.

Image source: Christopher Rieche (right)/Iwoca.

Take care of the pennies and the pounds will take care of themselves is a phrase many of us will be familiar with. But, now, for UK SMEs, a new team is in town to lend a hand.

Alternative business lender Iwoca and SME lending marketplace Funding Xchange have teamed up to launch the UK’s first fully automated cash advance product for online SMEs, powered by open banking.

SMEs trading through platforms like eBay or Shopify can now access Iwoca’s flexible loans of between £1,000 and £50,000 through the Funding Xchange marketplace, with automated repayments based on their monthly income.

“With our new cash advance product and our Funding Xchange partnership, we are continuing our proud track record of industry firsts. Just under a decade ago, we were the first UK company to integrate eBay and Amazon to provide instant credit decisions to e-commerce sellers,” said Christoph Rieche, CEO and co-founder of Iwoca.

“We were also the first commercial lender to offer a lending API, which is now used by over 20 major fintech partners, and the first SME lender to connect to the UK’s nine largest banks with Open Banking. »

E-commerce SMEs will be able to access the loan for a one-time fixed fee and will pay no interest, repaying only what they have borrowed based on their business income.

Businesses will also be able to shape their repayment plan based on their ups and downs, which means they will repay less during seasonal lows or interruptions to their operations.

“Iwoca and FundingXchange are leaders in using smart technology to make SME financing more accessible, affordable and sustainable,” added Katrin Herrling, CEO and co-founder of Funding Xchange.

“Given the challenges the crisis has created for small businesses, this partnership provides critical access to finance to help businesses rebuild and thrive.”

Although it took longer than some of its peers to be accredited, Iwoca distributed nearly £400m to SMEs through the Coronavirus Business Interruption Loan Scheme (CBILS) and applied for the Recovery Loan Scheme but hasn’t gotten the stamp of approval yet.

Just over a week ago, Funding Xchange integrated its lending marketplace into eBay Capital’s new integrated funding marketplace for eBay Business Sellers (CEBS), helping its sellers access funding by one place.

In just three months since its launch, 2,700 small businesses have borrowed £25.4m through CEBS.

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Martha J. Finley