Linked Finance launches new “Deferred Start Loan”
Linked Finance, Ireland’s leading peer-to-peer (P2P) lending platform, has launched a new “Deferred Start Loan” for businesses affected by the coronavirus. The innovative 15-month loan allows businesses to borrow up to €100,000, with repayments due in 12 monthly instalments after the first 3 months, during which no interest or capital repayment will be paid.
The loan is aimed at businesses who need working capital at a time of reduced cashflow; it is also an option for SMEs moving fast to adapt to the new normal, for example by investing in their online services, buying a second hand van for deliveries, or paying for equipment to get their staff up and running working at home.
The loan was launched yesterday and has attracted strong levels of interest from businesses attracted by the quick and easy lending process. The first loan was offered on Monday to a business services firm and was funded in 1 second with the support of our large base of investors who are keen to back Irish SMEs at this time.
The process for application is the same as for Linked Finance’s usual loans, with businesses filling in an online form and providing very simple financial documents: two years of full accounts, six months bank statements and a tax clearance cert. There are no assets secured against the loan so also no legal hurdles or fees involved, and early repayment can be made without penalty.
Last week Linked Finance unveiled a range of other financial supports it is offering to existing borrowers and new SME customers during the coronavirus outbreak.
In a show of support to its borrowers in the hospitality trade who are playing their part in delaying the spread of Covid-19, Linked Finance applied a blanket two-month payment break to all its loans across the restaurant, bar, pub and hotel trades. Linked Finance also announced repayment flexibility on existing loans for businesses in other sectors, and is willing to consider a break in the repayment schedule of up to 3 months.
Linked Finance is calling on the Government to work with the P2P lending sector and other alternative finance providers to use it as a channel for support to SMEs in addition to mechanisms being deployed through the traditional banking sector.
Commenting on the announcement, Niall Dorrian, chief executive of Linked Finance said:
“This is an extremely difficult time for many Irish SMEs, but we want to send a message that there are sources of financial support available that can be accessed quickly and easily. The new Deferred Start Loan we have launched allows companies access to much needed capital, whilst being able to delay repayment of interest and principal for the first three months.
This is part of a package of measures Linked Finance has introduced to support businesses in every country of Ireland who are facing unprecedented challenges due to coronavirus. We hope the Government will consider our sector as a key channel that can be used to quickly deploy support to help SMEs that are the lifeblood of employment throughout the country.”
Since its launch in 2013 Linked Finance has provided loans totalling over €130m, for more than 2,500 ambitious local businesses in every county of the country.
