Basel III regulatory capital rules favour mortgages 4x more than business lending so the trend in favour of P2P lending is clear:
- SME bank loans represented only 15% of new business loans in Australia last year (Source: RBA)
- SME loans by US major banks have fallen by 40% since 2006 (Source: Wall Street Journal)
- Bank lending to London’s SMEs plummeted 40% in the last year but an estimated £350m of SME finance was completed through peer-to-peer lending in 2015 (Source: British Bankers’ Association).
P2P finance has “the potential to become a game changer for small businesses and brokers. Because FinTech solutions are efficient and effective at lower scale, small businesses will be one of the main beneficiaries of FinTech’s disruptive power.” World Economic Forum Report, October 2015