Simply: Fintech SME lender expands loan book as firms turn to debt finance
Simply Asset Finance notched a record loan total in the last year as firms turned to debt financing to fuel their expansion plans.
The UK lender to small- and medium-sized enterprises topped £1.75bn in the total cumulative value of all loans they’ve approved and funded after the firm’s loan book expanded by £505m over 2024.
This helped the firm secure a 13 per cent year-on-year increase in revenue to £60.4m as pre-tax profit hit £8.5m.
Mike Randall, Simply’s chief executive, said SMEs needed “a partner that understands their challenges” amidst “economic uncertainty and policy shifts like the announcement of changes to National Insurance and minimum wage.”
Small firms have felt the crunch since Chancellor Rachel Reeves’ flurry of tax hikes in October. These included upping employer’s national insurance contributions and the national minimum wage, each adding millions of pounds in extra costs for many businesses.
Boom in SME lending space
Simply’s growth has come in line with a surge in the SME lending industry, pioneered mainly by fintech firms.
Simply upped its headcount by 4.5 per cent to 162 in the last year as it eyed further growth and investment.
This follows fintech darling and champion of SME lending Allica Bank delivering another record year in 2024 as it snapped up more of the market.
The digital bank’s profit ballooned by 86 per cent to £29.9m as lending activity grew over £1bn.
Richard Davies, Allica’s chief executive, previously told City PM the SME market was a “barren wasteland” five to 10 years ago.
The Big Four banks – Barclays, HSBC, Natwest, Lloyds – previously made up 90 per cent of SME lending, according to research from the British Business Bank.
The landscape has since drastically shifted with challenger banks accounting for a 60 per cent share.
Ministers called in Big Four bank bosses earlier this year to discuss small businesses’ struggles to access finance.
But figures from banking industry body UK Finance indicate high street banks are once again returning to the SME finance space, as lending hit its highest since 2022 in the first quarter of the year.
But Ylva Oertengren, Simply’s chief operating officer, told City PM she did not expect this to derail fintech’s momentum in the SME lending space.
“In the last couple of years, a lot of niche players have been developing and they have tailored the service offering utilising new technology, new data, new abilities to reach SMEs.
“The way larger financial institutions reach SMEs and get that funding out is by partnering with these different providers.”