Fintech lender, Creditspring, today announces that it has raised £48 million to supercharge its mission of improving financial stability across the UK.
The funds will be used to support more members to avoid high-cost, unscrupulous lenders and manage their finances through the cost of living crisis, which continues to tighten its grip across the UK. Creditspring’s latest Financial Stability Tracker shows that one in six (16%) UK adults will need to borrow in the coming months. Over the course of 2022, Creditspring plans to lend £100 million to support its members through its fixed-cost subscription loan services. This compares to a total of £25 million lent in 2021.
The number of Creditspring members has already increased by 50% - from 100,000 to 150,000 - since the start of 2022 and the company expects to add another 200,000 members by the end of the year. Of these new members, 14,000 applied to join the Stability Hub - a free tool that provides personalised support and actionable tips to encourage more informed financial decision making.
With energy bills and cost of goods increasing, the real value of wages declining and inflation continuing on an upward trajectory, it comes as little surprise that people are looking for support to manage their finances. Data from the Financial Stability Tracker shows that three in ten (29%) are terrified for their financial future, with this rising to one in four (39%) among people on the lowest incomes (under £10,000 per year).
The fintech will also focus funds on substantially growing the team, aiming to double the employee base by the end of the year and targeting 30 new hires in this quarter alone to help it deliver on its goals. It will be hiring for positions across all areas of the business, including data, engineering and customer operations.
Neil Kadagathur, Co-Founder and CEO of Creditspring, comments: “The significant growth in our customer numbers over the past six months highlights just how many people in the UK are in need of additional financial support.
“As people increasingly turn to borrowing to survive the cost of living crisis, it creates a perfect hunting ground for predatory lenders who do not have the best interests of their customers at heart. We must do all we can to help people reduce their chances of falling into unmanageable debt - never has this been more important than it is today.
“This fundraise allows us to deliver on our mission to help people across the UK build their financial stability with access to affordable credit and practical guidance.”
Chip Dunn, lead investor and Founder and CEO of Monomyth Group, comments: “Creditspring is proving to be a major disruptor in the lending sector, providing a much-needed alternative to high-cost, short term loans. Its pioneering subscription finance model is making lending more inclusive, responsible, and fair at a time when borrowers need these qualities most. Creditspring is driving real, positive change for people across the UK, and we are proud to be with them on this journey.”
Creditspring’s subscription model is a fixed-cost, low-risk credit solution that offers customers access to two advances per year, with clear repayments, capped costs, and no hidden charges. By paying a fixed fee to access credit, it is far easier for people to evaluate the true cost of borrowing, which significantly reduces the risk of a debt spiral.