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Funding Circle halves revenue growth guidance as demand falls
BRITISH peer-to-peer lending platform Funding Circle Holdings Plc on Tuesday halved its 2019 revenue growth projection to 20 per cent and tightened its lending standards as reduced demand for loans hit its earnings.
"The uncertain economic environment has reduced demand from small businesses and led us to proactively tighten lending criteria. As a result, revenue growth will be impacted," chief executive Samir Desai said.
Funding Circle also said it is "pausing" a planned expansion into Canada in order to focus on its existing markets, mainly Britain and the US.
The lender's shares fell as much as 25 per cent in early Tuesday trade and were down 10 per cent at 0715 GMT. They are down 71 per cent since the company floated in September amid wider concerns about the peer-to-peer industry model which works by matching borrowers with retail and institutional investors willing to lend for a return.
The negative update from one of Britain's most prominent peer-to-peer lenders will only intensify scrutiny from regulators and investors about the industry, following several high-profile problems in recent years.
Funding Circle has yet to turn a profit but said on Tuesday that it expected its annual loss for 2019 to be lower than in 2018. REUTERS