OakNorth announces British Business Bank ENABLE guarantee of £133m
OakNorth has today announced its participation in the ENABLE Guarantee programme, securing a guarantee of £133m from the British Business Bank, the UK government’s economic development bank. OakNorth will use the guarantee to strengthen further its lending support to fast-growth businesses and established property developers and investors.
The ENABLE Guarantee programme is designed to encourage banks to increase their lending to smaller businesses by reducing the amount of capital required to be held against such lending. Under an ENABLE Guarantee, the UK Government takes on a portion of the lender’s risk on a portfolio of loans to smaller businesses, in return for a fee.
OakNorth, which has recently been recognised as the fintech with the highest valuation in Europe, has lent over £3bn to businesses across the UK without a single default to date, which has helped create over 10,000 new homes (of which c.9,000 are affordable homes and social housing units) and 13,000 new jobs. While many larger banks are retrenching from the SME lending market due to ongoing economic uncertainty, OakNorth has seen this as an opportunity to continue helping ambitious British businesses to grow.
Rishi Khosla, CEO and co-founder of OakNorth, commented: “Since our launch in September 2015, we have been committed to helping businesses achieve their growth ambitions. The ENABLE Guarantee will enable us to lend even more to SMEs across the UK and help create new homes and jobs in the process.”
Patrick Magee, CCO of the British Business Bank said: “A key aim for the British Business Bank is to help diversify finance markets for smaller businesses, providing greater choice and competition. I’m therefore very pleased to continue our strong relationship with OakNorth, which is still a relative newcomer to the UK marketplace.
“The British Business Bank has so far committed guarantees for live portfolios of over £800m under its ENABLE Guarantee programme, and I look forward to seeing OakNorth continuing their support for smaller UK businesses with this guarantee.”