As part of our underwriting process, applications go through 3 distinct stages prior to being listed on our platform. Our aim is to present only the best of our applicants to our lenders. In the operations team we receive around 40 applications a month and reject 86% of these. We only allow the strongest applications with appropriate security on to the platform.
In Stage 1, we are looking for applications that meet our basic criteria. Over time we have become better at attracting more applications from eligible businesses, but we still have to reject nearly 13% of applications which do meet our requirements.
Stage 2 is our fact-finding stage, where we are looking to gather information to help us assess the business. Depending on the preparedness of the business this can be completed very quickly or may take a few months for all of the information to be gathered. This is also a key period for “drop-out” as some business owners decide that they do not wish to take the time to gather the requested information or that they will not be able to meet our requirements. At this stage 43% of applications do not provide us with the full set of information and nearly 10% of applicants choose to withdraw.
Stage 3 is split into reviews of Risk, Security and Financials which are carried out by our underwriting team, who look at the detail of the proposal. They will ask questions and try to determine the viability of the application. Nearly 21% of all applications are rejected at this stage, which represents 60% of the applicants that make it this far.
That leaves just shy of 16% of applicants that make it to listing, where 1% fail to raise the funds and 1% are fully funded but choose not to take the funds.
