JustUs, a UK-based peer to peer (P2P) lender, is planning to introduce its Small Business Interruption Loan Service (SBILS) by the end of next month and has asked the UK government to also take part in the program by lending alongside the crowd.
The SBILS is a non-government sanctioned program in contrast to the portfolio of COVID support funding schemes currently promoted by the UK government.
The SBILS program has its own website and has a stated goal of supporting firms that have fallen through the cracks of existing schemes.
This is why we built @SBILS_UK for the @ExcludedUK & wholeheartedly invite @hmtreasury @RishiSunak to support the engine room of our economy & lend alongside the great british public. 🇬🇧 The desperately needed Moneybrain Business GBP Account is downloadable via the app next week https://t.co/5bBHHHoyST
— Lee Birkett (@MrLeeBirkett) July 25, 2020
JustUs confirmed on July 13, 2020, that it will be using its technology to develop a platform that will aim to serve these businesses that may not be able to qualify for the UK government’s emergency loan schemes.
Companies may download the P2P lender’s Moneybrain app, which is a sister brand of JustUs. The app may be used to apply for loans, and after performing a review, the applicant’s request may be approved or rejected. If an application is accepted, then the SBILS team will assist the business with creating a loan request campaign.
Lee Birkett, founder at JustUs, has noted that the first crowdfunding campaigns are expected to launch toward the end of August 2020. The UK government’s COVID-19 business interruption loan scheme is scheduled to be released on September 30, 2020.
Birkett has said that “something needs to come in and replace it.”
As reported by Peer2Peer Finance News, JustUs has received many applications for the loan scheme. However, only around 5% of UK residents investing via SBILS will be approved, because it’s crowdfunding with the help of friends and family members, which places restrictions or limits on the number of people that may get involved or participate.
Birkett noted that the nation’s government guarantees could have helped JustUs with offering more funding to businesses during these challenging times.
Birkett also mentioned that the P2P lending platform could not take part in the government’s emergency loan programs, which was partly due to retail investors not being allowed to participate. The government refused to take part in SBILS, Birkett said.
“With government capital we would have been able to help 90% of people rather than 5%, but we have to do something. It’s going to be a shocking 12 months ahead which is why [we] need capital flowing urgently from the government and that’s why we invited the government to lend alongside the crowd on SBILS, but they’ve declined at the moment.
He claims that just about everyone was aware the government would not succeed with getting funds out to those who needed them, unless they worked cooperatively with Fintech solution providers.
He also noted that retail investors are “increasing their appetite so it’s crazy the government is only permitting institutional investment for government emergency loan schemes when appetite for retail is out there.”
Birkett pointed out that JustUs was built for those that have been excluded from the schemes. The P2P lender also developed an app that takes care of customer onboarding by using the same technology that Starling Bank and Tide have been using, Birkett explained.
Sole traders have the option of opening up a Moneybrain account right now. A limited number of businesses should also be able to open accounts toward the end of the week, Birkett confirmed.
“A lot of sole traders want to create limited companies to access the schemes but can’t even open a bank account, because most can’t open business accounts at the moment, it takes up to 12 weeks.”
In May 2020, JustUs said it would be focusing on lending to borrowers who are essential workers (during COVID-19).