Launched by PayPal in 2014, PayPal Working Capital is a small business finance scheme designed to provide flexible and affordable funding to the businesses which need it most.

The scheme reported a 116% increase in cash advances from the previous year and found that one third of all PayPal Working Capital advances have been provided to small businesses in areas which have lost 50 or more bank branches over the past four years.

“It’s great that we are able to help address a real need for small businesses where the more traditional sources for finance are letting them down,” said Mark Brant, managing director of PayPal UK.

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“According to the National Audit Office, that funding gap for small businesses could currently be as large as £39bn, with younger, smaller and online businesses hit especially hard as a result of having unconventional operating models and in many cases less established sales histories.”

Mark added that PayPal Working Capital was one of the ways it was redressing the balance of letting small businesses access a cash advance of up to £100,000 against their future sales.

“Instead of asking applicants to fill out lengthy forms and meet long-winded criteria, we judge eligibility based on their PayPal sales history – a process that takes a matter of minutes.

“There’s no credit check, interest charges or late payment fees either, just a single, fixed fee that is revealed up front.

“Repayments are applied automatically as a fixed percentage of a business’ PayPal takings, which gives them flexibility to pay back only when they’re making sales.”

Mark said it was then up to SMEs to decide how to use the money, whether it was invested in new equipment, resources or technology.

“Small businesses are the lifeblood of our economy.

“Here’s to many more milestone moments in supporting their success.”