Peer to peer lending websites: Funding Circle review


Funding circle brand image

Customer score

3rd out of 3 peer-to-peer lending websites


Funding Circle peer-to-peer lender overview

Launched in 2010, Funding Circle aims to help businesses struggling to access mainstream sources of finance, while providing individual investors with a good return on their money. As an investor, you can pick and choose which businesses your money is lent to, or have your money allocated automatically using the Autobid feature. There's no compensation fund, so compared to RateSetter or Zopa there's a bigger risk of losing money if your borrowers fail to keep up repayments – but the potential rates of return are higher. If you're happy to spend some time managing your investment, Funding Circle could be a good option.

Funding Circle peer-to-peer lender details

Lending terms

  • Minimum lend: £20 to any one company
  • Lending term: Six months to five years
  • Can I withdraw funds early? Yes, you can sell your loan parts for a 0.25% fee, if investors are willing to buy
  • Average rate of return for lenders: 6.4% (A+ grade loans; after fees and predicted bad debt, but before tax. Rates checked 9 June 2015)

Borrowing terms (businesses only)

  • Minimum amount you can borrow: £5,000
  • Maximum amount you can borrow: £1,000,000
  • Borrowing term: Six months to five years
  • Can loans be paid off early? Yes, and without any penalty fees
Funding Circle peer-to-peer lending satisfaction
Overall experience2 stars out of 5 
Savings rates3 stars out of 5 
Explanation of the risks3 stars out of 5 
Default rates2 stars out of 5 
Variety of products available3 stars out of 5 
Ease of use of the website3 stars out of 5 
Customer service3 stars out of 5 
Clarity of information on the website3 stars out of 5 
Online community2 stars out of 5 

Table notes:

  • Star ratings out of five show levels of satisfaction for each category.

What Funding Circle's customers say about them?

‘Good customer service, but I have lost money – despite not going for the highest risk option.’
‘A clear and straightforward approach. Unlike big investment firms, it speaks in a language that’s easy to understand.’
‘It gives you fine control over who you invest with. But can be time consuming.’

Alternatives to peer-to-peer websites

If you're looking for a loan, it's worth checking out Which? Best Rate personal loans too.

And if you're looking for a safe home for your savings, consider putting your money into a savings account or cash Isa. The Which? Money Compare tables let you search hundreds of savings accounts and cash Isa deals from providers large and small so that you can find a good home for your nest egg.

If you are content to take a little more of a risk for a potentially higher return, see our guide to investments.

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Last updated:

June 2016

Updated by:

Michael Trudeau


Which? Limited (registered in England and Wales number 00677665) is an Introducer Appointed Representative of Which? Financial Services Limited (registered in England and Wales number 07239342). Which? Financial Services Limited is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited. Registered office: 2 Marylebone Road, London NW1 4DF.