Alibaba is teaming up with two British companies to help finance small businesses in the UK looking to buy from Chinese suppliers.
The e-commerce giant announced partnerships with lenders iwoca and ezbob on Wednesday, which will provide short-term working capital to small business struggling to secure a loan from banks.
British firms hoping to access the Chinese market for cheaper components or goods will be able to apply for credit online. The two peer-to-peer lenders will then decide whether to provide funding based on the business’ data, including tax returns and the company’s track record. Ezbob and iwoca already lend to Amazon.com and eBay merchants.
Alibaba made a similar US deal with LendingClub last month, as part of a move to better access the American market. The UK and US are the company’s biggest markets outside China. The e-commerce company may offer similar partnerships to non-traditional lenders throughout the rest of Europe in the near future, the Financial Times reported.
Businesses will be able to access micro-loans from £50,000 and up, at an interest rate of 0.75 per cent to 2 per cent monthly, with the funds sent directly to Chinese suppliers to pay for goods in bulk.
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