Funding Circle lending contributes £7.9 billion to economy

As traditional banks pull back from small business lending, alternative finance is proving critical to unlocking the UK’s economic growth mission according to new research published by Oxford Economics and Funding Circle highlighting the impact of fintechs and alternative lenders in this market.

The data shows that in 2025, Funding Circle’s £3 billion of active loans under management generated a £7.9 billion contribution to the UK economy, while also sustaining 117,000 jobs across the country and generating £2.2 billion in tax revenues for the UK Exchequer.

Lisa Jacobs, Chief Executive Officer at Funding Circle, said: “SMEs are the backbone of our economy. They drive growth, create jobs, and keep our communities moving.

“This report shows the massive ripple effect created when we unlock capital. It’s clear that when we get more funding into the physical economy – everyone wins – and we’re moving at pace to ensure every small business has the backing it deserves.”

The research underscores the vital role of alternative finance in driving regional equality. In 2025, Funding Circle provided loans to SMEs in every single parliamentary constituency in the UK, averaging £2 million per constituency.

In underserved areas, the platform has become a core financial support; for example, Funding Circle accounted for 25% in Warrington North, and 25% in Bolsover.

The funding is also revitalising core sectors of the economy. Retail and wholesale businesses accounted for 22% of Funding Circle’s active loans, followed closely by construction at 17%, and professional services at 11%.