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Funding Circle

Lender or loan platform

PPP · PPPLF
Type
Company or group
Role
Lender or loan platform
Programs
PPP, PPPLF
Updated
  • Type: SME marketplace lender; London-listed parent with a U.S. lending arm that was a direct PPP lender of record.
  • Legal entities: Funding Circle Holdings plc (LSE-listed, 2018). U.S. PPP lender of record was FC Marketplace, LLC (dba Funding Circle); the U.S. business operated as Funding Circle USA (FC USA), Inc. until its 2024 sale.
  • Founded: 2010, London; entered the U.S. market in 2013.
  • HQ: London (U.S. unit: San Francisco).
  • CEO: U.S. Managing Director during PPP was Bernardo Martinez (signatories register; his career is covered in his profile).
  • Role in PPP: One of the four coalition-letter signers that show up in SBA data as direct PPP lenders of record. Also a named partner lender in Womply's 2021 Fast Lane channel, and a PPPLF borrower.

In the archive

Pandemic-role map

  • Reader shorthand: the mid-sized real lender in the letter cohort.
  • What Funding Circle did for borrowers: originated first- and second-draw PPP loans under FC Marketplace, both through its own channel and inside platform channels like Womply's Fast Lane, and referred other 2020 borrowers to partner banks.
  • Where responsibility sat: FC Marketplace held the lender-of-record rows and the PPPLF borrowing.

Before the pandemic (2010–early 2020)

UK-founded marketplace lender for small-business term loans, London-listed since 2018 with U.S. operations from 2013 (company site). Martinez signed the March 24, 2020 fintech coalition letter as U.S. Managing Director (signatories register).

During the pandemic (March 2020 – mid 2021)

Two ways to make a PPP loan

Funding Circle Holdings plc, the London-listed parent, announced on April 15, 2020 that the SBA and Treasury had approved it "to originate Paycheck Protection Program (PPP) loans that are 100% guaranteed by the SBA." Its U.S. unit ran the program two ways. It funded some loans through "institutional investors on the platform" and referred other borrowers to partner banks; in September 2020 the company said its average transaction fee "across the two models was c.2.5%." Its full-year 2020 results put the U.S. total at $474 million originated from May to August 2020, at an average transaction fee of 3.15%.

SBA loan data credit FC Marketplace, the U.S. lender of record, with 5,963 loans approved in 2020 for $283.1 million. A January 2021 company release said that in the first round Funding Circle was "approving nearly $1 billion in PPP loans" and that "the funding helped protect more than 112,000 jobs across the country." Borrowers on FC Marketplace's 2020 loans reported 41,017 jobs in the SBA data. The $1 billion counts approvals, and the company's $474 million of originations includes loans referred to partner banks; the SBA rows cover only loans on which FC Marketplace was the lender.

The Fed line and the 2021 fee rule

FC Marketplace took its first advance from the Federal Reserve's PPP Liquidity Facility on June 26, 2020, at 0.35%. In March 2021 chief financial officer Oliver White said joining the facility "meant that the origination economics of PPP are broadly similar to that of our core product"; before that, he said, "our partnership model led to lower yields." After the Economic Aid Act of December 27, 2020, the SBA's processing fee on loans of $50,000 or less went from 5% to "the lesser of 50 percent of the loan amount or $2,500," a House Select Subcommittee staff report said.

In 2021 FC Marketplace made 10,649 loans for $284.9 million: about the same dollars as in 2020, spread over 1.8 times as many loans. Of those, 9,471 were for $50,000 or less. Funding Circle reported yields "of nearly 9% on US PPP loans, higher than the 3% in H1 2020," and £16.3 million of U.S. transaction fees in the first half of 2021. Because the facility funded the loans, White said, they were "on Funding Circle's balance sheet, although with no Funding Circle equity invested." FC Marketplace took 118 advances from the facility, $319.5 million in all, and its outstanding balance peaked at about $315.5 million. Modeled from the SBA's published fee schedule, its lender fees come to about $13.7 million on the 2020 loans and $29.2 million on the 2021 loans.

Layoffs and pay

On July 8, 2020, the company said it would centralize U.S. technology work in the U.K. and move sales and marketing to Denver, with workforce reductions "resulting in a net reduction of c.85 roles." California's WARN report lists a notice from Funding Circle USA, Inc. dated the same day: 86 permanent layoffs in San Francisco, effective September 7, 2020. The average number of U.S. employees was 292 in 2019 and 240 in 2020. The U.S. restructuring booked £1.0 million of redundancy costs, and the group took a £12.0 million non-cash impairment of U.S. goodwill. In September, CEO Samir Desai said some of the changes were "things we had considered, but were accelerated by the COVID crisis."

The Board and Global Leadership Team "volunteered 20% reductions to their salaries and fees over the period from March to May 2020." The 2020 annual report says there were "no salary reductions for the wider employee base" and that the company "did not claim any furlough or other government support for payment of salaries." For 2021 Desai waived a raise to £400,000, so he "will therefore only receive £210,000." The report's next sentence: "His incentives will be based on his reference salary of £400,000."

What existing borrowers were told

Chief risk officer Jerome Le Luel said in September 2020 that borrowers who enrolled in forbearance got "typically a three month plan." At the end of August 2020 more than 80% of U.S. customers were making payments, he said, and a larger share than in the U.K. was "still on a payment holiday." An April 2020 version of Funding Circle's U.S. PPP page answered whether PPP money could pay an existing Funding Circle loan: "customers can use the Paycheck Protection Program loan proceeds to pay interest with existing Funding Circle loans. However, any amount applied to non-mortgage debt or principal payments will not qualify for loan forgiveness." By March 2021 the page said Funding Circle "does not charge an application fee" for a PPP loan.

By the SBA's September 2024 data, 14,953 of FC Marketplace's 16,612 PPP loans show forgiveness, totaling $504.4 million, and 1,417 loans, approved for $54.5 million, carry the loan status "Charged Off."

Named on a March 2021 Womply Fast Lane lender list

A March 3, 2021 Womply Fast Lane capture names Funding Circle alongside Cross River, Harvest Small Business Finance, Fountainhead, Lendio, and SmartBiz as partner or originating lenders. Appearing in that list is a structural fact, not an allegation; the record does not show how much FC volume came through Womply versus its own channel.

After the pandemic (mid 2021 – present)

No enforcement

No PPP enforcement action against Funding Circle has been located, and it is not named in the House Select Subcommittee's fintech-PPP report.

The 2024 sale of the U.S. business

In June 2024, Funding Circle Holdings agreed to sell its U.S. business to iBusiness Funding, LLC, Ready Capital's technology and lending-services division, for £33 million, closing in July 2024 (Funding Circle, Ready Capital and Latham & Watkins releases). American Banker reported that Funding Circle surrendered its newly won Small Business Lending Company license because the buyer's group already held one.

The parent today

Funding Circle Holdings continues as a UK SME finance platform (full-year 2025 results).

Sources

In this archive

External references

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