The programme consists of £30m already committed by ESO Capital, £70m concluded with Waterfall Asset Management and the balance to be provided by Waterfall and other institutional investors, subject to certain conditions.

All funds under the programme will continue to be invested in loans originated through ThinCats, which will provide loans of up to £5m for growing UK SMEs.

“This additional investor base will allow us to significantly increase funding for small businesses’ expansion, acquisition or refinancing plans,” said Damon Walford, chief development officer at ThinCats (pictured above).

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“Our focus on providing amounts up to £5m based on assets and reliable cash flows means we occupy a space where traditional providers ‘can’t work’ rather than ‘won’t work’.”

Henrik Malmer, managing director at Waterfall, added: “ThinCats occupies a unique space in the market and we are pleased to invest in senior secured loans made to growing and ambitious small businesses, which we see as a positive addition to our portfolio.”

Ravi Anand, managing director of ESF, said it had engaged across the institutional market and this was the first key initiative in its plans to provide significant funding to UK SMEs.

“Generating a strong and sustainable yield from providing finance for small and growing businesses is a compelling alternative to traditional fixed income investments when combined with the funding gap left by conventional lenders.”

Damon added that ThinCats had built up its team to service the market focused on working alongside professional intermediaries to source opportunities.

“…This funding ensures we are able to provide certainty to borrowers and their advisers.

“This is a significant stage in the continued development of our business, which we plan to significantly increase over the next two years and we are excited by what the future holds."