The partnership will see Aegon fund £160m of loans in the first 12 months through the online lending platform, with the intention to extend this step by step into a four-year funding programme.

Funding Circle expects the first year of the partnership to help around 2,600 UK businesses to access finance, creating an estimated 6,400 new jobs.

“The strategic partnership we have signed with Funding Circle is another important step in the strategy of Aegon to cooperate with fintech partners in the direct lending landscape,” said Mike de Boer, CFO at Aegon Bank NV.

“This partnership gives Aegon access to attractive small business loans over the next four years, which helps to further diversify our investment portfolio. 

“High savings inflow of our successful Fintech Knab banking operation is used to invest in the Funding Circle loans.

“This agreement follows an extensive due diligence on the loan origination, compliance and risk-returns of the Funding Circle loans.”

Aegon joins a wide range of investors who use Funding Circle to lend directly to UK SMEs.

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Other investors include 65,000 individuals, local councils, the British Business Bank and the European Investment Bank.

“This partnership is validation of the attractive risk-adjusted returns that are being generated to investors by lending through Funding Circle,” said Samir Desai, CEO and co-founder of Funding Circle. 

“Now investors of all shapes and sizes can benefit from the stability of the asset class, while also providing much-needed job creation and economic growth. 

“We hope our joint programme with Aegon will develop to deliver increased lending to UK small businesses over the coming years.”

The partnership was welcomed by Stephen Barclay, the economic secretary to the Treasury. 

“Small businesses are the lifeblood of our economy and it’s fantastic news that Aegon is investing through Funding Circle to help them thrive and grow. 

“This partnership with one of the UK’s largest fintech firms is further proof that the UK remains the global leader in fintech. 

“Aegon’s venture also shows that there is significant appetite for inward investment into the UK and we hope to see more deals of this scale in the future.”

Image attributed to Aegon