Zencap was a German company, operating a peer-to-peer lending platform, which allowed private savers to lend money directly to small and medium-sized businesses in Germany, Spain, and the Netherlands.[1] Using the crowdfunding model, the company based in Berlin, Germany[2] aimed to create a direct link between private lenders and small businesses seeking loans.[1][3][4][5] As of December 2014, Zencap had facilitated 5 million Euro in loans to small and medium-sized firms.[6]
The business model resembled the US peer-to-peer lending platform Lending Club and UK-based company Funding Circle.[12][failed verification] Zencap facilitated small business loans from 10,000 to 250,000 euros.[1] Zencap determined whether the borrower was creditworthy and assigned a credit grade that determined the payable interest rate and the fees. Zencap itself charged borrowers a 1% to 4.5% origination fee. The loan period ranged between 6 and 60 months while the loan could be repaid without an early repayment fee at any time.[13] Conditions varied between countries.
Der Tagesspiegel quoted founder Christian Grobe, "We are very strict with the risk assessment."[1] Once approved, businesses posted their loan request on the Zencap marketplace, where private lenders were able to choose which businesses they wanted to lend money to.[14]
Funding Circle acquisition of Zencap
In October 2015, Zencap was acquired by UK based Funding Circle, another lending platform in Europe.[15] Zencap was active in Germany, Spain and the Netherlands.[15] The merge made Funding Circle one of the main peer to business lending leaders in Europe.
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