A partnership between Lancashire County Council and Funding Circle has provided £1.5 million to 230 local businesses.
The scheme, the first of its kind, was set up two years ago to provide capital to small ands medium sized enterprises in the area and saw the council provide £350,000 while Funding Circle investors have funded the balance.
Natasha Jones of Funding Circle said:
“For some time now, small businesses have faced serious difficulty in accessing finance from traditional lenders. Lancashire County Council has recognised that Funding Circle can provide local businesses with a solution and help them grow, and we’re very pleased to be working in partnership with them.
Since the partnership was set up, Funding Circle have taken the scheme to a further 10 councils in the UK. andJones added:
“Online marketplaces are the future of finance, allowing local people and organisations to play a direct role in supporting local business growth. We hope to be able to work with many more councils moving forwards.”
The scheme has won backing from the British Business Bank, which was created to help small businesses find alternative ways of funding.
Lancashire Council are said to be very pleased with the success of the scheme and council leader Jennifer Mein said:
“Our innovative approach has since been taken up by other councils across the country and even the government, who recognised the value of it.”
“We’re keen to work in pioneering and practical ways to provide real opportunities for businesses here in Lancashire to pursue their passions and ambitions. There is a lot of potential to grow the economy here in the county and Funding Circle is just one of our many successful schemes to encourage this growth.”
Reward-based crowdfunding platform Crowdfunder have been doing something very similar and have raised over £4000 for variety of local projects in Surrey, Nottingham, Bristol, Cornwall and Plymouth.
The more of these schemes that are set up are only going to help small businesses grow and at the same time improve the economy of the UK.