FOLK2FOLK, the UK’s largest peer-to-peer lending platform, celebrated its milestone 10th anniversary this year. For a decade, the company has enabled the financial aspirations and dreams of thousands across the UK; providing access to finance for small business owners, and monthly income for private investors.
Originating in Cornwall, amid the remnants of the financial crisis in 2013, when funding for businesses was drying up and savers were receiving rock-bottom levels of interest, FOLK2FOLK was founded to address the significant funding gap that faced local businesses and to provide investment opportunities for local savers and investors.
FOLK2FOLK Co-Founder, Louis Mathers, said: “There was definitely an anti-establishment element to why FOLK2FOLK was started.
“We wanted to demonstrate that we could provide funding, and investment opportunities, better than the banks.
“There are invisible barriers to finance for rural small businesses and in effect, they are discriminated against compared to their urban counterparts. We wanted to level the playing field for these businesses and our answer was to organise the funding ourselves.”
Within a year, FOLK2FOLK facilitated £22 million in loans. Early growth propelled the company beyond its Cornish roots, and by early 2015 nearly £50 million of funding had been invested within Cornwall and Devon. The company went on to expand nationally, providing funding for regional small businesses and presenting attractive property-secured investment opportunities for private investors across the UK. FOLK2FOLK has since grown to become the largest platform for peer-to-peer lending, having facilitated more than £653 million in business loans across regional UK.
Staying true to its core ethos of fairness has been a hallmark of FOLK2FOLK’s journey. “We’ve always operated on the basis of fair exchange,” Louis emphasises, “working to balance the funding needs of borrowers and the risk and reward expectations of investors.”
For a company renowned for its friendly personal service, an ongoing challenge has been to ensure the right balance between technology and people,” FOLK2FOLK is not the type of business you can entirely automate,” Louis explains, “our customers value their personal interaction with us, and both underwriting and security due diligence require our human expertise.”
Over the decade, FOLK2FOLK has helped many businesses start, grow or diversify including farm diversification projects, renewable energy schemes, small-scale property developments, and leisure and tourism facilities. The ripple effect of FOLK2FOLK’s funding extends beyond just those who borrow and invest via the platform, and it is this that Louis is most proud of.
Providing funding for a diverse range of businesses in regional areas often translates into job creation, strengthening of local supply chains, more housing, and the creation or improvement of local facilities which enrich communities and positively contribute to local economies. In 2017, the company coined the word FOLKNOMICSTM to describe this.
Louis comments on the broader impact, “Our operations have undeniably led to more prosperous rural locales and it’s not hard to see the impact when speaking with our customers.”
For its investor community, FOLK2FOLK facilitates millions of additional income annually (in excess of £1million a month).
FOLK2FOLK’s journey from budding platform to a profitable, multi-award-winning, and leading peer-to-peer lending platform is testament to resilience and commitment.
“Growing a business within a new industry during uncertain times was challenging. But looking back, it’s empowering to see how FOLK2FOLK stayed the course, achieving market-leading success and profitability in an industry that has seen significant attrition over the years,” Louis reflected.
Looking ahead, Louis is optimistic about the future, envisioning steady and sensible growth.
“I am extremely proud of what we have achieved over the past 10 years. I am grateful to those who believed in the FOLK2FOLK vision from the start and to our investors, borrowers and partners. By pulling together, we have created a shining example of how sharing capital resources can make a meaningful difference in people’s lives and we look forward to continuing to make a positive impact over the next decade and beyond.”