Does the term crowdlenging sound familiar to you? Do you know the alternative to traditional business loans? If you are an entrepreneur, whether of a small company or SME, this information interests you. FundingCircle is a new option to obtain liquidity for your company and opt for online loans with lower interest rates than with traditional banking products.
This platform, which began operating in the United States in October 2015, is the intermediary between small companies that want to request a quick loan and thousands of institutions or individuals who want to invest and lend money. Crowdlending is the easiest way to find financing for your company, in a comfortable, fast and transparent way.
What is and who are FundingCircle
FundingCircle is a business credit granting company that operates through the internet. It does not depend on banks, since loans are made by private investors and other companies.
It was created in 2010 in order to give financing to companies without having to go through the banks. It was in 2015 when they arrived in the United States, as they saw that it was something necessary and an expanding market for SMEs.
They have the support of large investment companies that have supported projects such as Facebook or Skype. Its partners include renowned companies in the financial field such as SquareVentures, DST Global, Ribbit Capital, BlackRock and AccelPartners.
They grant credits from € 5,000 to € 250,000 to limited or anonymous corporate forms, to be returned within a period of 6 months to 5 years.
The interests of your loans vary depending on the profile of each company. The more risk that company has of not being able to return the money, the higher the interest. Even so, they offer very competitive interest rates compared to bank loans.
Advantages of these online loans
If you are the owner of an SME, you will already know difficulty when it comes to finding credit through traditional channels. Surely you have also experienced the refusals of the banks when applying for a loan and, of course, the frustration that is experienced when not getting that money that you need so much to continue growing and evolving.
The next question you may be asking yourself is: What does FundingCircley offer me, why would I have to choose this option rather than borrow money from a bank or entity?
Here are the answers:
You have a free financial study at your disposal: After making the credit request, they prepare a totally free study where they analyze the best options to finance your company. In case you do not want to go ahead with your loan, you will not have to pay anything.
You do not waste your time in bank branches: All operations are online, so you do not waste time waiting in line at the bank. In addition, the response to your request is in less than 48 hours.
Ease of choosing the repayment term: You do not have strict pre-established terms, you can choose the number of installments in which to comfortably repay your loan. Between 6 months and 60. You choose.
Very competitive interest: The interest rate on these loans is 4.79%. Very competitive percentage compared to other loans on the market. To these interests must be added the management costs that amount to € 750.00, but this amount is included in the loan itself.
You have no early cancellation fees: If you decide to pay your debt before the agreed term, you will not have to make any extra payments.
Your loan does not count in CIRBE: This means that the borrowed money will not be added to your credit history from the Bank of United States risk information center.
How can I apply for my loan
In order to access this financing, you will have to request your loan through the website www.fundingcircle.es . When you enter your page, the message to request a loan appears and by clicking on the button the application form will appear.
Once you have filled out this form, where you will be asked for information about your company, benefits, billing interval, etc., Fundingcircle will analyze your situation and validate the project on the platform. At that time, interested investors will intervene by providing the money you need for your company.
After 21 days, although you can extend the term, you will be able to check if your project has been financed 100% or in part, thanks to the contributions of private investors. It will be time to receive the contract and the money in your account within a maximum period of 10 days.
In summary, these are the simple steps you must follow to request your fast credit:
- Enter the web and fill out the credit application indicating the amount and the duration you want.
- You will receive a reply within 48 hours , with a proposal that will include the interest to be paid and the exact conditions of your loan.
- Your credit is published on the web: Investors offer their money to finance your loan for 21 days. If at the end of this period 100% has not been achieved, you can choose to keep the financed part of the credit.
- If your credit or part of it is financed by investors , you will receive the contract to be signed and, finally, the money in your account.
What requirements must I meet to request a loan
In order to request money at Fundingcircle and benefit from its advantages, you must know the requirements that you must meet and know this information.
- This platform only grants money to limited companies (SL) and public limited companies (SA) that have been established for more than two years or, in other words, that have been operating for two fiscal years.
- Your minimum billing must be € 100,000 per year and not have any default.
If you meet these requirements, you are the optimal profile for your SME to access this type of online credit.
What documentation do I need
The documentation requested by FundingCircle can be uploaded directly through its website, which will make the procedures much faster. In order for them to evaluate your application you will need to provide:
- VAT data for the year prior to which you are requesting the loan.
- The account and the balance of results of your company.
- The corporation tax for the last two years.
If you are a company and invoices more than € 100,000 per year, here is the perfect alternative to traditional bank loans thanks to the contributions of investors interested in your project.
Funding Circle overview