People Lend GBP1M Directly to Small Businesses to Defy Banks in Just 10 Weeks

LEEDS, England, November 4, 2010 - The British public has defied banks and lent GBP1m to the UK's small
businesses via Funding Circle (www.fundingcircle.com) in its first 10
weeks. Funding Circle is the UK's first ever online marketplace where people
can directly lend to small businesses. The social lending platform's success
highlights the pent up demand for affordable finance from small businesses
and the desire from consumers for better rates of interest (
www.fundingcircle.com/lend/risk-returns/) on their money than
available from banks.

    - 35 credit-worthy businesses across the country have accepted
      business loans (www.fundingcircle.com/) via Funding Circle
      ranging from a water treatment company in Scotland, to a legal services
      provider in North Wales and a t-shirt printing company in London.
      Expansion / growth capital accounts for approximately half of all
      loans.

    - Average loan size of GBP30,000

    - Average interest rate 8.2 per cent, substantially below the
      12 per cent that banks typically charge businesses

    - 1,600 members with lenders aged from 18 to over 80

Businesses can borrow between GBP5,000 and GBP50,000 for
either one or three years with the loans repayable monthly. Each loan is
comprised of small amounts of borrowing from many different people who
compete to lend to the business in question enabling it to borrow at a better
rate. With no bank in the middle, both lenders and borrowers achieve a better
deal.

Lenders set interest rates themselves with the lowest offers
being accepted by the borrowers. To date lenders have received 8.2 per cent
annual interest on average which far exceeds the typical savings account
which pays less than 1 per cent.

The Funding Circle model has been designed to reduce risk to
lenders. Experienced Funding Circle underwriters comprehensively assess each
application using the same information that banks use and only allow
established and creditworthy businesses into the marketplace. Approved
borrowers are then split into risk bands to give lenders a clear indication
of the level of risk entailed in lending to them. To date, all businesses
have fully repaid on time.

Plugging the gap left by the banks

Funding Circle co-founder, James Meekings, said:

"The response to Funding Circle has been phenomenal. For
consumers to lend GBP1 million to businesses via the site in just 10 weeks
highlights the public's appetite to support our small business community
whilst also earning themselves a fantastic return. Small businesses are the
backbone of the UK economy accounting for 99 per cent of all UK enterprise
and 50 per cent of private sector employment.[i] Despite this, they are often
dismissed by banks and even the recent Taskforce report[ii] signed by the
heads of six of the major banks fails to address the provision of support
needed by small businesses. Funding Circle is helping to plug that gap."

TutorCare, a provider of training courses based in West Sussex
secured a loan of GBP40,000 at a rate of 8% via Funding Circle.

Gareth Jones of TutorCare said:

"It's difficult to get banks to cough up these days, despite
the fact we've been up and running - and making a profit - for three years
and the rates they are charging are way over the odds.

"Getting loans from banks in the past has been tedious - you
almost have to go begging. But with Funding Circle it was actually fun and
interactive as people bid to lend you the money.

"Funding Circle is exactly what small businesses need to get
them through these tough times. You can't grow, take on more staff and boost
the economy without the funds to put into your business."

Geoff Chapman, a Funding Circle lender added: "I like the idea
that I am helping small businesses to be successful and in turn be helping
the economy - they are vital and employ large numbers of people. On top of
this I'm making a great return."

Phil Orford, Chief Executive of the Forum for Private
Business, said:

"The borrowing landscape is beginning to improve for British
small businesses thanks to Funding Circle's service. We are reassured by the
attention currently being paid to the difficulties facing small businesses
and hope funding will become increasingly available to small companies, which
are so valuable to the British economy."

Notes to editors

Funding Circle (www.fundingcircle.com) is the first ever online
marketplace to enable savers and investors to sidestep banks and lend
directly to small businesses. Funding Circle differs from other social
lending platforms in that it facilitates loans to businesses, rather than
consumers. It provides low cost finance for creditworthy, small UK firms
frustrated by the loan terms offered by the high street banks.

The monthly repayment loans available are for either one or three years
and for between GBP5,000 and GBP50,000. Each loan will be comprised of small
amounts of borrowing from many different people who compete to lend to the
business in question, enabling it to borrow at a better rate. With no bank in
the middle, both lenders and borrowers achieve a better deal.

Lenders on the platform have typically been receiving interest rates of
between 6-9 per cent, several percentage points above savings-account rates
in banks.

Funding Circle has been co-founded by Samir Desai (formerly of Olivant &
the Boston Consulting Group), James Meekings (formerly of OC&C Strategy
Consultants) and Andrew Mullinger (formerly of Citigroup, Ernst & Young and
Nomura).

Read more about the team here (
www.fundingcircle.com/home/about-us/).

Funding Circle is also provided to members of the Forum of Private
Business as part of the organisation's Finance Director business support
solution, which is a range of services offering complete reassurance across
all financial business matters. The Forum is a not-for-profit organisation,
providing comprehensive business support, protection and reassurance to small
to medium-sized businesses across the UK. It provides practical, tailored
solutions that promote business success through expert advice and guidance,
and by being the co-ordinated voice of its small business members in
government.

———————————

[i] Department for Business Innovation & Skills, SME Statistics 2008, p1.

[ii] `Supporting UK business: The report of the Business Finance
Taskforce', October 2010.

To arrange an interview with Funding Circle or to speak to a lender or borrower please contact: Giles Abbott, Marketforce Business Media Ltd, direct line. +44(0)20-7760-8631, switchboard. +44(0)20-7608-3222, email: gabbott at marketforce.eu.com .