Funding Circle Review

If you are planning on starting a business, one of the most important considerations is funding. How will you fund your business? Where will you get the money? There is always the option of bootstrapping – using savings and personal sources to fund the business – but the risk is great. You might lose everything plus the shirt off your back if your business does not succeed.

You should also keep in mind that business success does not happen overnight. It may take six months to 1 year before your efforts gain traction. Putting everything on the line may not be the best thing to do.

Pros & Cons Of Funding Circle Loans.

Before deciding on a lending program, find out its pros and cons. What are the pros and cons of Funding Circle Loans?

Pros:

• Offers competitive rates
• Funds can be released within three business days
• Zero prepayment penalty
• Does not require a minimum annual income
• Excellent customer service

Cons:

• The application process is longer compared with other online lenders
• Strict requirements for new business owners

An Overview of Funding Circle Loans

Funding Circle is a UK-based online lender operating in the US through its partnership with Endurance Lending Network.

The lending company offers installment loans or term loans to established small and medium-sized enterprises (SMEs). Loan terms offered range from six months to five years. The rates are lower, and fees are less compared with other online lenders.

Funding Circle does not accommodate loan applications from newly established or startup businesses. Businesses that have been operational for two years or more have better chances of acquiring loans.

What Are The Loan Application Requirements Of Funding Circle Loans?

To qualify for a loan, you must meet the following requirements:

• Minimum length of business operation: 2 years
• Credit Rating: 620 and up
• Annual Income: Not specified

Note: If your business has any record of bankruptcy (last seven years) or tax lien (last 10 years), your loan application will be denied. Funding Circle does not accept applications from businesses engaged in the following:

• Speculative real estate
• Non-profit organizations
• Manufacturing of weapons
• Gambling
• Marijuana sale
• Pornography

The interest rate will depend on the borrower’s creditworthiness, business performance, and other criteria such as the nature of the business, loan term, and real-time financial data.

With instalment loans, you have to option pay off the loan early without incurring penalties. This way you will be able to skip the interest fees for the succeeding months. To get an estimate of your monthly payments, check Funding Circle’s support page and our loan calculator. You will incur penalties for insufficient funds or missed payments so make sure to comply with the payment schedule.

Loan Application Procedure

The first step is to complete an online application that will pre-determine if you meet Funding Circle’s criteria for borrowers. Next, the company will do a soft check on your credit history. When you pass the initial stage of the application, an estimated quotation will be sent to you. A company representative will contact you to discuss loan options and answer your queries.

Next, you will be asked to submit the following documents:

• Business tax returns (last 2 years)
• Personal tax return (previous year)
• Bank statements (last 6 months)
• Business debt

If your business is registered as a general partnership, a thorough credit check will follow. If you all go well with your consultation with the representative and the submission of your documents, your application will be forwarded to the underwriting department. A loan offer (loan amount, payment terms, interest rate, and origination fee) from Funding Circle will be sent to you within 24 hours. If you agree on the terms, your loan will be released in a few days. It only takes five days or less for an application to be processed.

Promotional Transparency

Funding Circle uses a straightforward approach to marketing their services. The company website is very informative and user-friendly. Funding Circle is a signatory of the Small Business Borrower’s Bill of Rights, a network of lenders committed to provide accessible and transparent financing to SMEs.

Customer Service

The customer support team of Funding Circle can be easily contacted via phone and email. They have active social media accounts (Facebook, YouTube, Twitter, and LinkedIn) which you can opt to follow. During your loan term, you will be assigned an account manager who can help you address any issue that may arise.

Customers Feedback

Are there positive reviews about Funding Circle? Funding Circle earned a BBB accreditation and an A+ rating. Based on more than 5,000 reviews on Trustpilot, customers voted four out of five stars.

Here are the key features that borrowers favored most:

Convenient Application Process

The majority of the borrowers did not have any trouble following the application procedures. They found the process easy to follow.

Excellent Customer Service

This is the highlight of the positive reviews because many borrowers praised the customer service team for being efficient in responding to queries and resolving issues.

Fast processing

Borrowers like how Funding Circle processed applications and released loans quickly.

In contrast, there are also negative reviews about Funding Circle.

To date, Funding Circle has 18 reviews plus 4 complaints on Better Business Bureau and a few negative feedbacks on Trustpilot.

The following issues were pointed out:

• High-Interest Rates: Funding Circle rates are higher than what banks offer.
• Strict Application Requirements: Some borrowers found the application process to be slower compared to other peer-to-peer lenders.
• Unnecessary Sales Calls: Some customers did not like getting too many calls from the marketing team.
• Not ideal for Startups: Funding Circle requires applicants to have a business that’s been running for at least 2 years.

What Is Our Verdict On Funding Circle?

Funding Circle’s lending rates are relatively low compared to other peer-to-peer lenders. The quick pace of the application process is another point worth considering. Although banks can offer better rates, Funding Circle can provide quicker and easier access to the funds you need for your business. As always, we suggest that you carefully weigh all your options before you choose a lender.