SMEs Discover Lending Crowdfunding, Boom of Applications in 2023

Lending crowdfunding is a form of collective financing that allows people to lend money to small and medium-sized businesses, in exchange for an interest rate, in addition to the obvious repayment of capital.

According to data provided by Opstart (a fintech crowdfunding hub and among the leading players in the industry) related to its Crowdlender-owned portal, this type of crowdfunding is experiencing particular growth, with +273 percent year-on-year over the first few months of 2022. The increase follows that of previous semesters, which stood at +30%.

“100% of the companies we have financed through our platform to date have paid interest and principal on time. This demonstrates the soundness of our selection criteria when we decide to promote a partner company,” says Giovanpaolo Arioldi, CEO of Opstart.

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63.24% of the lending crowdfunding transactions analyzed belong to the sustainability and green sphere

As anticipated, the regions that believe most in this form of investment include Lombardy, with 35.24 percent of investors, Piedmont (25 percent), Emilia-Romagna (7 percent), and Veneto (5 percent). Why these regions? They are regions with a very strong entrepreneurial fabric and, not surprisingly, are the regions from which a large proportion of the issuing companies come.

Going into the details, the number of investors in the first 5 months of 2023 has already exceeded the number for the whole of 2022 by 68%, and among the provinces that most support lending crowdfunding are Milan, Bergamo, and Monza-Brianza, but also Turin, Bologna, and Treviso.

63.24% of the lending crowdfunding transactions analyzed belong to the sustainability and green sphere, with 47% related to energy efficiency upgrades of large buildings, through the 110% bonus. In second place, with 19% of operations, is the pure real estate sector, unrelated to the 110% bonus. The real estate sector, in all its facets, thus accounts for about 66%, often overlapping with the world of sustainability.

What is driving lending crowdfunding, which compared to last year is experiencing robust growth (+273%)?

The average annual interest rate offered in the first half of 2023 is 8.56%; in 2022 it was 7.71%. “Lending crowdfunding,” Opstart’s CEO points out, “is therefore an excellent opportunity for investors. In the specific case of Opstart, we hypothesize that the type of campaigns proposed also made a difference.

In fact, most of the projects presented belong to the sphere of sustainability, green, and energy efficiency. Investing with Crowdlender therefore means making an ethical choice as well, participating in operations that have a positive impact on the planet, Arioldi concludes.”

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(Featured image by stevepb via Pixabay)

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First published in Verita&Affari. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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