Lending to UK SMEs
– Annual Report 2024
Comprehensive analysis of SME lending debentures registered at Companies House in 2024. Covering banks, challenger banks, independent lenders, loan specialists, and property finance providers.
CEO's Commentary
A healthy year of growth for SME lending has seen some surprising trends. Lender activity in 2024 was 13% higher than in 2022, following a slowdown led by the property sector in 2023. This surge, measured by charges registered at Companies House, reveals shifts in lending behaviour, including the continued rise of independent loan providers who now compete directly with established lenders.
Key drivers included improved business confidence compared to 2023, conclusion of government pandemic support, a pre-budget activity spike in autumn 2024 driven by CGT concerns, recovery in property prices and sales volumes, and loan providers seizing market opportunities.
The Big 4 banks continue to dominate lending in the UK, submitting over one third of all debentures, with 56% of their activity focused on existing customers. Despite holding the majority of available capital, these banks primarily concentrate on large, conventional, low-risk ventures, leaving higher-risk opportunities to the independents.
– Julian Dobbin, January 2025
Key Insights
- Lending rebounded to 2022 levels — The property market recovery and improved business confidence drove activity back up, though still below pandemic highs.
- Challenger banks surged +43% — Led by Aldermore (+116%), Allica Bank (+50%), and Atom Bank (+91%), challenger banks registered the highest proportional banking growth.
- Loan specialists exploded +162% — Bizcap entered the market with 601 new debentures, Funding Circle launched a secured product (+1,017%), and CubeFunder grew +142%.
- Bizcap challenges Bibby — Bizcap's typical business profile closely mirrors established lenders (average net assets: £337k vs Bibby's £343k), with unsecured lending suggesting total facilities may exceed those publicly recorded.
- Average SME debts rose to £66k — Total disclosed debts per SME increased +4.1% (external debt £53.4k, asset finance £12.6k), with real inflation-adjusted growth at +0.9%.
- Pre-budget spike in autumn 2024 — CGT concerns drove increased activity across banks, large ABL, and structured providers in the latter half of the year.
Significant Growth in Lending Facilities
Lending rebounded to 2022 levels in 2024, driven by challenger banks, independent lenders, and a recovery in the property sector. Independent and loan providers registered the greatest growth.
Debentures by Lender Category
Approximately 52% of registered debentures in 2024 were new to the lender.
All Debentures
| Category | 2022 | 2023 | 2024 | 24 v 23 | % |
|---|---|---|---|---|---|
| High Street Banks | 27,504 | 25,069 | 28,770 | +3,701 | +15% |
| Other Banks | 16,429 | 14,693 | 15,262 | +569 | +4% |
| Challengers | 9,707 | 9,365 | 13,404 | +4,039 | +43% |
| The Banks (Subtotal) | 53,640 | 49,127 | 57,436 | +8,309 | +17% |
| ABL + Invoice Finance | 5,245 | 5,567 | 6,124 | +557 | +10% |
| SME Loan Providers | 411 | 770 | 2,031 | +1,261 | +164% |
| Asset Finance | 943 | 1,006 | 980 | −26 | −3% |
| Large Structured Lenders | 726 | 557 | 837 | +280 | +50% |
| R&D Finance | 126 | 225 | 168 | −57 | −25% |
| Trade Finance | 130 | 162 | 175 | +13 | +8% |
| Government Supported | 626 | 658 | 856 | +198 | +30% |
| Other SME Lending (Subtotal) | 8,207 | 8,945 | 11,171 | +2,226 | +25% |
| Subtotal (excl. property) | 61,847 | 58,072 | 68,607 | +10,535 | +18% |
| Property Specialists | 80,191 | 65,583 | 80,847 | +15,264 | +23% |
| Grand Total | 142,038 | 123,655 | 149,454 | +25,799 | +21% |
New Debentures Only
| Category | 2022 | 2023 | 2024 | 24 v 23 | % | % New |
|---|---|---|---|---|---|---|
| High Street Banks | 12,964 | 11,514 | 12,651 | +1,137 | +10% | 44% |
| Other Banks | 6,255 | 5,436 | 6,035 | +599 | +11% | 40% |
| Challengers | 5,658 | 5,395 | 8,172 | +2,777 | +51% | 61% |
| The Banks (Subtotal) | 24,877 | 22,345 | 26,858 | +4,513 | +20% | 47% |
| ABL + Invoice Finance | 4,553 | 4,675 | 5,099 | +424 | +9% | 83% |
| SME Loan Providers | 362 | 702 | 1,938 | +1,236 | +176% | 89% |
| Asset Finance | 466 | 516 | 423 | −93 | −18% | 43% |
| Large Structured Lenders | 540 | 364 | 453 | +89 | +24% | 64% |
| R&D Finance | 111 | 172 | 108 | −64 | −37% | 64% |
| Trade Finance | 123 | 174 | 171 | −3 | −2% | 98% |
| Government Supported | 538 | 546 | 723 | +177 | +32% | 101% |
| Other SME Lending (Subtotal) | 6,693 | 7,149 | 8,915 | +1,766 | +25% | 81% |
| Subtotal (excl. property) | 31,570 | 29,494 | 35,773 | +6,279 | +21% | 52% |
| Property Specialists | 43,032 | 34,150 | 42,076 | +7,926 | +23% | 52% |
| Grand Total | 74,602 | 63,644 | 77,849 | +14,205 | +22% | 52% |
New debentures are those where the first registered charge with a lender is to a specific company, removing the distorting impact of multiple facilities with the same borrower.
Average SME Debts
UK companies disclosed a 4% rise in debts in 2024. The average SME now owes external lenders £66,000.
| Year | External Debt (£k) | Asset Finance (£k) | Total (£k) |
|---|---|---|---|
| 2022 | 51.9 | 11.0 | 62.9 |
| 2023 | 51.3 | 12.1 | 63.4 |
| 2024 | 53.4 | 12.6 | 66.0 |
| Movement (£k) | +2.1 | +0.5 | +2.6 |
| % | +4.1% | +4.0% | +4.1% |
| Real movement* (£k) | +0.5 | +0.1 | +0.6 |
| Real %* | +0.9% | +0.8% | +0.9% |
* Inflation adjusted
Challenger Banks
44% of High Street debentures are "new to bank", compared to 61% for challengers. Aldermore lost its position as the biggest High Street bank for SMEs but registered the most new charges of all banks.
| Lender | 2022 | 2023 | 2024 | 24 v 23 | % | Avg Net Assets (£k) | Avg Staff |
|---|---|---|---|---|---|---|---|
| Aldermore Bank | 2,081 | 1,912 | 4,121 | +2,209 | +116% | 254 | 2 |
| Shawbrook Bank | 2,316 | 1,941 | 1,920 | −21 | −1% | 396 | 7 |
| Allica Bank | 751 | 861 | 1,289 | +428 | +50% | 636 | 11 |
| Atom Bank | 147 | 202 | 385 | +183 | +91% | 428 | 8 |
| OakNorth | 267 | 307 | 277 | −30 | −10% | 6,907 | 43 |
| Oxbury Bank | 96 | 126 | 133 | +7 | +6% | 1,598 | 10 |
| GB Bank | 0 | 46 | 46 | 0 | – | 913 | 3 |
While not a lender, Starling Bank received the most mentions in annual accounts filed at Companies House out of all challengers.
Independent Debt Providers
Another strong year of growth for many independent lenders.
ABL + Invoice Finance
| Lender | 2022 | 2023 | 2024 | 24 v 23 | % | Avg Net Assets (£k) | Avg Staff |
|---|---|---|---|---|---|---|---|
| Close Brothers | 970 | 1,128 | 1,009 | −119 | −11% | 4,333 | 32 |
| Bibby Finance | 650 | 668 | 819 | +151 | +23% | 343 | 22 |
| eCapital Commercial Finance | 451 | 480 | 481 | +1 | +0% | 155 | 11 |
| Reward Finance Group | 97 | 323 | 477 | +154 | +48% | 1,082 | 28 |
| Novuna | 319 | 245 | 263 | +18 | +7% | 310 | 11 |
| Skipton Business Finance | 192 | 251 | 269 | +18 | +7% | 286 | 13 |
| Cynergy Business Finance | 184 | 205 | 216 | +11 | +5% | 1,097 | 76 |
| Ultimate Finance | 143 | 118 | 156 | +38 | +32% | 267 | 52 |
| Time Finance | 160 | 147 | 178 | +31 | +21% | 211 | 15 |
| Team Factors | 105 | 140 | 187 | +47 | +34% | 16 | 9 |
| Apollo Business Finance | 95 | 166 | 159 | −7 | −4% | 0 | 5 |
| Zodeq | 99 | 109 | 178 | +69 | +63% | 92 | 19 |
| Praetura | 106 | 123 | 124 | +1 | +1% | 812 | 29 |
| Quba Solutions | 95 | 94 | 152 | +58 | +62% | 44 | 3 |
| SME Invoice Finance | 116 | 110 | 101 | −9 | −8% | 759 | 313 |
| Optimum SME Finance | 80 | 103 | 148 | +45 | +44% | 41 | 10 |
| Sonovate | 69 | 95 | 141 | +46 | +48% | 91 | 102 |
| IGF | 101 | 87 | 117 | +30 | +34% | 2,881 | 190 |
| 4SYTE | 73 | 107 | 114 | +7 | +7% | 469 | 17 |
| Kriya | 149 | 111 | 12 | −99 | −89% | 693 | 31 |
SME Loan Providers
| Lender | 2022 | 2023 | 2024 | 24 v 23 | % | Avg Net Assets (£k) | Avg Staff |
|---|---|---|---|---|---|---|---|
| Bizcap | 0 | 0 | 601 | +601 | New | 337 | 13 |
| Nucleus Commercial Finance | 47 | 258 | 476 | +218 | +84% | 248 | 15 |
| CubeFunder | 75 | 123 | 298 | +175 | +142% | 30 | 5 |
| Funding Circle | 9 | 24 | 268 | +244 | +1,017% | 311 | 17 |
| WhiteOak | 12 | 37 | 74 | +37 | +100% | 2,780 | 30 |
| One Stop Business Finance | 19 | 51 | 48 | −3 | −6% | 150 | 8 |
| Merchant Money | 33 | 64 | 42 | −22 | −34% | 509 | 9 |
| Adsum | 5 | 0 | 26 | +26 | New | – | 2 |
| Simply Funded | 0 | 0 | 20 | +20 | New | 513 | 29 |
| Think Business Loans | 30 | 25 | 19 | −6 | −24% | 106 | 1 |
| Swish Fund | 26 | 41 | 15 | −26 | −63% | 240 | 13 |
| Swift Fund | 24 | 26 | 14 | −12 | −46% | 934 | 27 |
| Mellor Finance | 7 | 17 | 14 | −3 | −18% | 29 | 10 |
Most loan lenders work on an unsecured basis, so these figures are likely to be highly understated. Funding Circle now offer a secured product, which has seen strong take up.
Bizcap Emerges as a Leading Player
Proactive strategies and rapid funding propelled Bizcap from zero registered debentures to 601 in a single year, closing the gap on established market leader Bibby Finance. Average net assets differ by only 2%.
Property Specialists
Property specialists experienced a 25% uplift in activity, mirroring the c27% growth in property sales in the UK.
| Lender | 2022 | 2023 | 2024 | 24 v 23 | % |
|---|---|---|---|---|---|
| The Mortgage Works | 7,029 | 4,903 | 6,399 | +1,496 | +31% |
| Together Commercial Finance | 2,482 | 2,801 | 3,930 | +1,129 | +40% |
| Paragon Bank | 3,127 | 2,691 | 3,055 | +364 | +14% |
| OneSavings Bank | 2,126 | 2,074 | 2,094 | +20 | +1% |
| Fleet Mortgages | 1,689 | 1,973 | 1,875 | −98 | −5% |
| Charter Court Financial Services | 4,357 | 2,413 | 1,578 | −835 | −35% |
| Paratus AMC | 2,565 | 798 | 1,487 | +689 | +86% |
| Kensington Mortgage Company | 1,642 | 704 | 1,431 | +727 | +103% |
| Landbay | 1,621 | 1,582 | 1,404 | −178 | −11% |
| LendInvest | 1,216 | 664 | 1,312 | +648 | +98% |
| The Mortgage Lender | 1,536 | 1,468 | 1,212 | −256 | −17% |
| Hampshire Trust | 737 | 639 | 911 | +272 | +43% |
| Nottingham Building Society | 726 | 561 | 833 | +272 | +48% |
| Keystone Property Finance | 618 | 497 | 704 | +207 | +42% |
| Vida Homeloans | 787 | 293 | 592 | +299 | +102% |
| Quantum Mortgages | 48 | 303 | 576 | +273 | +90% |
| Leeds Building Society | 0 | 47 | 571 | +524 | +1,115% |
| West One Loan | 521 | 580 | 517 | −63 | −11% |
Independents – Mentions in Financial Statements
As many lenders don't submit debentures, Spark analysed financial statement mentions across c5 million companies.
43.4%
Funding Circle
21.3%
Close Brothers
20.1%
Capital on Tap
8.0%
Bibby Finance
7.2%
Iwoca
Based on 2024 findings, Spark expect Bizcap to appear on this list in coming years.
Regional Invoice Finance Distribution
The South East and London continue to dominate invoice finance activity, while Wales, Scotland, Northern Ireland, and North-East England have seen noticeable increases in facilities when comparing 2022 to 2024. The chart below shows the leading lender by region alongside total top-3 lender volume.
Data shown represents the top 3 invoice finance lenders per region by new charge count (2024). Total regional volumes would be higher when including all lenders.
Access the Full Report
Want the complete analysis including regional breakdowns, High Street bank detail, and bank-level analysis? Get in touch with the Spark team.
Contact the Spark TeamMethodology
AI plays a pivotal role in empowering Spark to harness its vast repository of company data and knowledge. Around 9,000 debenture holders have been matched to approximately 800 lenders through a combination of human-based matching and AI-generated matching.
This analysis does not attempt to mitigate the impact of multiple charges by the same lender for a group of companies — one funding facility to a group may involve the submission of as many as 20 new debentures. In the general charges analysis, company group structures are not consolidated and each entity is treated independently; multiple charges from the same company are counted individually and are not deduplicated. For group-consolidated analysis, see the Invoice Finance specific report.
Charge types covered: Property Finance (registered in most circumstances), Invoice Finance (registered for almost all "whole book" facilities), Trade Finance (registered in some circumstances), Asset Finance (rarely registered except larger lines), Loans (majority of small facilities do not invoke a charge).
Average debts: Analysis covers approximately 3.9 million SMEs (trading SMEs and property SPVs), excluding companies with over 1,000 employees or over £50m in debt or net assets.
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