Just over a decade ago, entrepreneur Giles Andrews came up with a plan to tackle a glaring weakness in Britain’s banking industry.
He found that customers seeking to borrow money from high street banks in the form of an unsecured loan suffered from clunky, lengthy application processes and poor customer service.
Mr Andrews’ solution was to connect borrowers directly with people willing to lend money in return for interest — thus cutting out the banks. His vision gave rise to Zopa, which launched in 2005 as the world’s first peer-to-peer lending site, providing a blueprint for what has become a global industry.
“The inspiration behind the idea was that we didn’t believe consumers were well-served by banks; we thought the banks had forgotten who their customers were and didn’t put them right at front and centre of what they did,” Mr Andrews says.
Now the businessman is in a new venture that could involve joining forces with the very industry he set out to disrupt. Mr Andrews, who was awarded an OBE in 2015, has been appointed chairman of MarketInvoice, another type of peer-to-peer site that focuses on serving small businesses in need of cash.
In his new role, Mr Andrews is aiming to help scale up the business while attempting to preserve its nimble “fintech” culture.
MarketInvoice promises companies a quicker, more transparent and often cheaper source of working capital than from banks, by letting companies sell their invoices in return for cash. The site has grown rapidly, extending more than £1.1bn of finance to small businesses since it was founded in 2011 — almost half of which came in the past year.
Its founder Anil Stocker, an ex-Lehman Brothers employee, aims to reach £2bn of total lending this year, helped by the launch of a new service to offer finance secured against all of a company’s invoices, rather than on a per-invoice basis.
Mr Stocker is also in talks to provide banks with access to its platform as a “grey-label…