Stripe, a financial infrastructure platform for businesses, launched new payments tools and financing options in the UK that will improve access to capital and accelerate the growth of hundreds of thousands of UK businesses.
The new product features “include business financing through Stripe Capital, lower-cost Open Banking-powered payments, and faster payouts.”
The announcements took place at Stripe Tour London, the company’s annual internet economy conference in the UK, attended by founders, developers, and enterprise leaders.
John Collison, cofounder of Stripe said:
“UK businesses are inventing and building, but getting access to capital at the right time is a rate limiter on their growth. The payments tools and financing options we’re launching today will help money move around the economy faster and make it easier for businesses to invest when they see an opportunity to grow.”
The UK is Stripe’s second largest market, and its “growth is accelerating.”
Around 600 UK businesses join the Stripe network every day, a significant increase even from pandemic highs, “when swathes of companies were forced to move online to survive.”
Stripe’s UK users include disruptive innovators “like Monzo, Octopus Energy, and over half of the UK’s top AI startups, as well as established companies such as ITV, River Island, Nando’s, and Hargreaves Lansdown.”
Only 50% of bank loan applications by UK small businesses “were successful last year, down from 80% in 2018.”
Without the funds to invest in new products, or modernize their processes, many small firms are forced “to rein in their aspirations. In a recent study, less than half of UK businesses said they aspire to grow this year.”
With the launch of Stripe Capital in the UK, small businesses “can access flexible financing to invest in their own expansion—whether that’s buying new equipment, growing their staff, or upgrading their customer experience.”
Stripe Capital uses a company’s transaction and business history on Stripe “to proactively qualify businesses for financing.”
Funds hit approved accounts the next business day, and businesses “repay the amount as they earn.”
Stripe Capital is proven to accelerate growth.
An analysis of Stripe users in the US found “that businesses that took financing from Capital grew their revenue 114% faster than peers, with the smallest businesses seeing revenue growth of 140% more than peers.”
Stripe Capital is now available to UK businesses “that run directly on Stripe. Later this year, UK marketplaces and platforms that use Stripe Connect will also be able to use Stripe Capital to offer financing to their own users.”
Platforms are an important part of the UK’s small business economy, “with more than half (55%) of online payments to small businesses in the UK today being handled by platforms like Shopify (for retailers) or Treatwell (for salons).”
Small businesses use these platforms “on a daily basis to handle sales, bookings, and other operations.”
They’ll soon be able to access near-instant financing “on the platforms they’re already using, powered by Stripe Connect.”
This is helpful both for the small businesses, “who can grow faster, and for the platforms, who can open a new revenue stream.”
For the largest platforms running on Stripe today, financial services revenue “is now growing 11x faster than payments revenue.”
UK businesses on Stripe will “be the first to access new payment methods and capabilities built on payment infrastructure that the UK pioneered.”
Today, Stripe launched its first Open-Banking-powered payment method, Pay by Bank, in the UK. Pay by Bank is “a low-cost, real-time payment method that allows consumers to pay directly from their bank account.”
Online car marketplace Cinch and insurance brokerage AJ Gallagher “are among the large companies that are already using Pay by Bank to reduce their payment costs and improve their cash flow.”
Businesses selling high value goods and services “could save tens of thousands of pounds in payment fees every month.”
