Channel Capital Advisors LLP (Channel) is pleased to announce the launch of its specialist Fintech Lending Strategy, with commitments from global institutional investors.
The first $100m tranche of the $300m strategy will be deployed immediately to leading fintech lenders.
Channel’s fund will be deployed to digital lending fintech platforms that require capital to finance their loans to SMEs. A substantial pipeline has been built and capital will start being deployed straight away.
Channel is a UK-based asset manager that is authorised and regulated by the FCA. Over the past 15 years, it has deployed over $20 billion of credit assets including loans, working capital facilities, and securities.
More recently, Channel has invested heavily in developing proprietary systems using APIs, Open Banking and cloud-based, artificial intelligence-driven technologies to prospect, assess and monitor SME credit risk. As well as offering SMEs funding through fintech lenders, Channel’s technology infrastructure will subsequently be available to partners to roll out their own SME lending propositions.
Channel’s Fintech Lending Fund will initially be deployed through lending platforms in developed markets in Europe and North America.
The fund seeks to invest in diverse portfolios of corporate credit risk on a senior or mezzanine basis, with junior participation from the fintech principal. The capital is flexible and can scale rapidly with growth.
In recent years, fintech lenders have originated hundreds of billions of USD in loans, growing exponentially. Debt investments (like business loans) are popular with many SMEs whose founders and owners do not want to dilute their equity.
Paul Wilson, Channel’s Chief Investment Officer, said: “The investment into our Fintech Lending Fund is a significant step forward for Channel - it will see us work closely with other digital platforms to facilitate loans for SMEs that are faster, simpler, and don’t dilute their business. Indeed, the deployment of dedicated funds like this is crucial in supporting and fuelling the ongoing growth of the global SME sector.
“The backing our fund has received underlines investors’ growing appetite within the fintech lending space. Moreover, it’s a clear demonstration of the trust investors have in Channel’s track record of managing their investments.”
Walter Gontarek, CEO of Channel, added: “Providing much-needed capital to the often-overlooked SME sector has always been a goal at Channel. Fintech lending platforms are a critical part of that - making it faster and easier for deserving SMEs to access loans.
“We have been tirelessly enhancing our own digital lending capabilities and have exciting developments coming in that space. Meanwhile, the sizeable investment into our Fintech Lending Fund will see us work with a greater number of tech-powered lending platforms, firstly in Europe and North America, to see capital deployed at pace to the global SME community.”