The new BNP Paribas UK SME Debt Fund 1 will invest in senior loans to SMEs with an annual turnover of less than £50m, which are originated via BNPP AM’s SME Alternative Financing platform.
Using proprietary big data technology, together with access to BNP Paribas’ balance sheet and infrastructure, the platform is designed to provide SMEs with access to a sustainable source of funding.
According to Stéphane Blanchoz, head of SME Alternative Financing at BNP Paribas Asset Management, “Since the global financial crisis there has been a paradigm shift in the market as new funding models have emerged.
“Banks remain a key feature of the SME lending market and investment funds have traditionally been providing financing in the upper end of the mid-market area, while smaller companies are increasingly accessing finance through fintech crowdfunding solutions or peer-to-peer lending.
“We are targeting SMEs between these two market segments, where there are opportunities for businesses to contribute to UK GDP growth, but where sustainable funding solutions are limited.”
In November 2017 BNPP AM announced the acquisition of a 10% stake in alternative SME credit specialist Caple, whose proprietary technology platform offers access to a network of around 70 accountancy and advisory firms. More recently, in July 2018, BNPP AM announced a strategic alliance with CODE Investing, a UK based fintech lending platform.