RBS preps P2P lending platform - FT

RBS preps P2P lending platform - FT

The Royal Bank of Scotland is set to begin piloting an online peer-to-peer lending platform for SMEs by the end of the year, according to the Financial Times.

RBS has been working with an unnamed third party platform on its plans for the last year and will provide loans for firms struggling to get capital from high street banks.

Figures from the UK Peer to Peer Finance Association show that the P2P market has picked up over the last couple of years, with lending increasing by 121% during 2013. Cumulative lending at the end of quarter four hit £843 million compared to just £381 million at the end of 2012.

Although the industry initially pitched itself as a rival to established lenders, the two sectors have been cosying up recently. Earlier this year Santander began referring some small business customers looking for a loan to Funding Circle, pointing firms to the P2P alternative through its website and in letters.

Chancellor George Osborne said over the summer that soon all banks that reject loan applications will have to follow Santander's lead and refer customers elsewhere.

Separately, America's biggest P2P platform, Lending Club, has picked the New York Stock Exchange for its initial public offering, in which it hopes to raise $500 million later this year, says the FT.

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