Funding Circle profit quadruples to £24m as SME lending grows

Funding Circle has reported a fourfold increase in profit before tax to £24.1 million for the first half of 2026, as revenue and SME lending grew strongly.

Revenue increased 50% year-on-year to £138.2 million in the six months to 30 June, compared with £92.3 million in H1 2025. Profit before tax rose from £6.0 million to £24.1 million, taking the PBT margin to 17.4%, up from 6.5%.

The SME finance platform extended £1.69 billion of credit during the period, an increase of 52% from £1.11 billion a year earlier. Funding Circle said it supported a record 18,000 SMEs during the half.

Assets under management (AuM) reached £3.25 billion, compared with £2.83 billion at the end of June 2025 and £2.96 billion at the end of 2025.

Growth was led by Funding Circle’s Term Loans business, where originations increased 43% to £1.05 billion. Term Loans AuM rose to £2.95 billion, while the division’s PBT more than doubled from £12.7 million to £28.6 million.

Activity across FlexiPay and Credit Card also increased, with transactions rising 71% to £640 million. AuM across the products reached £300 million, up from £169 million a year earlier, while their combined loss before tax narrowed from £6.7 million to £4.5 million.

Funding Circle said FlexiPay had reached free cashflow breakeven, while its funding facility with Citi was renewed and increased to £320 million in April, providing £400 million of lending capacity when Funding Circle equity is included.

The group ended the period with unrestricted cash of £136.5 million, up from £100.9 million at the end of 2025.

Following the stronger first-half performance, Funding Circle has upgraded its full-year guidance. It now expects 2026 revenue of more than £255 million, compared with previous guidance of around £235 million, and PBT of more than £40 million, up from its previous expectation of at least £35 million.

The company also plans to launch a further share buyback of up to £25 million following completion of its current programme, taking total announced buybacks since March 2024 to £100 million.

“It has been another strong half for Funding Circle, reflecting the momentum across our business and continued execution against our multi-product strategy.

“We delivered record revenue performance, up 50% year-on-year, and PBT grew fourfold to £24m. As a result of our strong performance, we are upgrading our full year 2026 guidance to more than £255m in revenue and more than £40m in PBT.”

Funding Circle said its technology and data capabilities remained central to its growth strategy, with AI being deployed across product and engineering, marketing and distribution, customer service, operations, credit and underwriting.

The business now records a customer transaction every 20 seconds, compared with once every 30 minutes in 2021, while 31% of customers use more than one Funding Circle product.

Jacobs added: “The opportunity in front of us remains substantial. Economic growth starts with small businesses – every day, entrepreneurs across the UK are investing, hiring and innovating, and Funding Circle exists to help them do exactly that.”

Funding Circle continues to target revenue of approximately £300 million to £350 million by FY29, with PBT margins in the low-to-mid 20% range.