Prestige Funds finance arranger accredited by British Business Bank for £200m scheme
Nucleus Commercial Finance, one of the specialty lenders which manages several loan portfolios for Prestige Funds, has been accredited by UK government owned British Business Bank as a provider of GBP 200 / USD 270m in loans under the Coronavirus Business Interruption Loan Scheme (CBILS). This tranche of capital is being provided by two large international investment groups and the Prestige group.
The CBILS is designed to provide financial support to smaller businesses across the UK that are losing revenue or seeing their cash flow disrupted due to the Covid-19 outbreak. The scheme is operated via lenders which meet the British Business Bank’s strict eligibility criteria.
The first 12 months of interest on any facilities under the scheme will be paid by the UK government as a Business Interruption Payment. The first tranche of GBP 100 / USD 135m was awarded to Nucleus in July 2020 and the second was formalised in December 2020. Nucleus says it plans to lend the additional GBP 100 / USD 135m before the scheme ends at the end of March 2021. Since Nucleus began its participation in this scheme it has received almost GBP 1 / USD 1.35bn of new loan enquiries.
Chirag Shah, CEO of Nucleus, commented: “Once the government loan schemes come to an end later this year there will be a significant funding gap in the UK. This is where Nucleus, as a fintech lender, will continue to play a vital role to bridge this gap and support businesses by providing the finance they need.
“SMEs are now turning to alternative and fintech lenders as the first point of call due to our innovative solutions and ability to provide funds more quickly than high street banks. This tranche of funding will further accelerate this trend and cement our position as the leading fintech for SME finance.”
Nucleus Commercial Finance acts as the originator and manager of thousands of loans using finance deployed by the Prestige operated ‘Commercial Finance Opportunities Fund’ (CFO). The company has assembled a market leading team of financial professionals from leading banks as well as investing in the latest technology to speed up loan approvals and management.
Nucleus has lent more than GBP 1.7 / USD 2.3bn to UK SMEs since it was established in 2011. It works with many companies that require specialist financing that is no longer provided by traditional banks. Nucleus makes loans in the range of GBP 3,000 / USD 4,000 up to GBP 50 / USD 65m.
Craig Reeves, founder of Prestige, added: “The investment made over the past couple of years in Nucleus Commercial Finance’s technology (NCF) has now started to prove its worth. We are very pleased that one of our lenders has passed the stringent due diligence requirements to be approved as a provider of loans recognised by the British Business Bank. It is a hallmark of the considerable work already put in to make Nucleus a world class lending operation.”
The UK SME market is a critical part of the economy, accounting for 99.9% of the British business population. Despite the efforts of governments in the UK and further afield, traditional banks are not acting quickly enough to channel much-needed funds to small businesses. Much of this has come down to a lack of investment in technology and processes to cope with the SME lending environment. Lenders like NCF are simply better positioned to make quick loan decisions during the current crisis.
The conclusion of the Brexit deal and the mass roll out of multiple vaccinations is also starting to provide confidence among investors, debt providers and some small business sectors.
