City & Corporate: Peer-to-peer lender steps up its comms

The UK's largest 'peer to peer' lender has brought in PR help as it bids for a chunk of government money to boost lending to small businesses.

Funding Circle has hired Portland after a multi-agency pitch to support the firm's key positioning as an alternative to banks for investors and business borrowers.

The firm, established in mid-2010, brands itself as an 'online marketplace' bringing together a range of private lenders to loan money to small and growing businesses.

PRWeek understands that the company narrowed its search to a two-way shortlist of Portland and Blue Rubicon, before selecting the Omnicom-owned agency.

The firm previously used PR firm Brazil.

David de Koning, head of comms at Funding Circle, confirmed Portland's appointment. He joined late last year from Fishburn Hedges.

The news comes as the firm is looking to step up its activity by applying for a chunk of £100m in funding that the Government has earmarked for alternative lenders.

Funding Circle is applying for £30m to create an account to allow the Government to join other potential lenders in issuing loans to small firms.

Investors have lent more than £30m to small businesses through Funding Circle to date, with lenders receiving a gross yield of 8.5 per cent.

The Government has previously stressed the importance to the UK economy of growing small and medium enterprise (SME) lending, but UK banks narrowly missed lending targets for 2011 set out under the Government's Project Merlin initiative.

In February 2011 Portland was hired to work with the Business Finance Taskforce, a drive by the UK's six largest banks to improve relations with the SME sector. The brief lasted for less than a year as banks moved away from collective efforts to concentrate on their own campaigns.

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