SME-focused alternative lender ThinCats unveils record lending of £400m in 2023 - but cautions over market conditions this year

Alternative finance provider serving mid-sized firms cheers record lending total in 2023 – but forecasts mixed picture over the course of this year.

An alternative business lender that has backed a wide range of growing Scottish companies has seen the amount of funding it has provided to UK businesses jump by almost a third in 2023 to a record level – but said that it expects overall market sentiment and appetite for new funding to “remain relatively subdued” in 2024.

ThinCats, which lends between £1m and £15m to mid-sized firms, has revealed that it provided a record £395 million of funding to firms last year, up 31 per cent from 2022, with the total it has now lent to companies across the UK clocks in at more than £1.7 billion, while assets under management stand at £790m.

Announcements last year of Scottish company activity that it has bankrolled include Glasgow-headquartered IT recruitment specialist Be-IT Resourcing’s multi-million-pound management buyout; and a substantial growth funding package for Aberdeenshire-based Paradigm Flow Services that specialises in pipeline remediation and fire protection technologies.

ThinCats CEO Amany Attia says the firm 'has still been able to achieve growth of more than 30 per cent in a softening market'. Picture: contributed.

That came after the news in 2022 that it provided an eight-figure funding package enabling the founders of Ace Winches, which is also based in Aberdeenshire, to buy back the business; backing a buyout of children’s residential care group Inspire Scotland with a multi-million pound funding facility; and providing a funding facility to Sixco, the Glasgow-based group behind the Six by Nico restaurant network.

Amany Attia, chief executive of ThinCats, has now said: “Despite a challenging economic environment, ThinCats has continued to invest in committing resources to the SME market, allowing us to deliver nearly £400m worth of funding to UK mid-sized businesses. 2023 was a tough year for many businesses, with industry data showing a significant fall in overall transaction activity and value of funding. However, ThinCats has still been able to achieve growth of more than 30 per cent in a softening market, highlighting the increasing relevance of our funding proposition to existing and prospective borrowers and to their advisers.

“Throughout 2023 we continued to invest in our people, deepening our regional footprint, and in relevant technology to support many great businesses keen to take advantage of growth opportunities, either organically or through acquisition. Looking ahead into 2024, we expect overall market sentiment and appetite for new funding to remain relatively subdued reflecting weak UK [gross domestic product] growth forecasts, although we expect confidence to gradually pick up now that interest rates seem to have peaked. Feedback from advisers suggests that the impending general election may also act as a catalyst for some business-owners to consider funding to support their succession plans.”

The financial services firm says it provides funding to firms of all sectors for growth, acquisitions, refinancing and restructuring. It is based in Ashby-de-la-Zouch, Leicestershire, and has a regional team covering Scotland and Northern Ireland, which includes Ben Kimball in the role of director, regional business development, who previously held senior roles at banking giants Lloyds Banking Group, Barclays, and Royal Bank of Scotland.