BNP Paribas launches UK SME lending fund

Greg Gille
@unquotenews
23 July 2018

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BNP Paribas Asset Management has launched a vehicle targeting the UK SME lending market.

BNP Paribas UK SME Debt Fund 1 will provide senior loans to SMEs with an annual turnover of less than £50m. The investments will be originated via BNP Paribas Asset Management's SME Alternative Financing platform, which uses big data technology and the bank's balance sheet and infrastructure.

The bank stated it launched the initiative to target the market segment between smaller companies (which rely more heavily on tech-driven crowdfunding and peer-to-peer lending) and the upper end of the mid-market segment where debt funds become more prominent.

The fund is likely to compete with players that have identified and looked to capitalise on this same perceived funding gap, most notably Beechbrook Capital. The firm reached a final close on £150m for its maiden SME-focused credit fund in early 2017; the vehicle supplies £3-15m senior secured loans to UK non-private-equity-backed SMEs. It targets businesses with turnover of between £10-100m and EBITDA of more than £1m.