Press Relese

3 August 2009

FOR IMMEDIATE RELEASE

Unique new lending system promises outstanding rates for investors

As the economy heads into freefall, and cash-deposit rates plummet to 0.5%, a Cheshire firm launched this week is offering a ray of light for investors. Using the already successful model of social lending rolled out to private individuals, Big Carrots offers investors potential returns of up to 16% and business loan rates as low as 6.5%.

How does it work? The firms lending and borrowing service simply cuts out the banks, allowing businesses to borrow at low rates from other businesses and the man in the street. Sometimes known as peer-to-peer lending, the system sees businesses and individuals lending small amounts typically £50 to £100 to other business borrowers. So, typically, a £10,000 loan for new machinery might come from as many as 200 lenders.

With other firms bidding down the loan, rates can be as low as 6.5% much lower than the High Street lenders. Crucially, they can also borrow for as little as three months so Big Carrots is a great alternative to an overdraft. For peace of mind,all the businesses on Big Carrots have been rigorously risk-assessed, to prove they they're creditworthy.

Lenders who could be someone who wants a better return than the cash rate of 0.5%, someone looking to diversify their portfolio or perhaps someone who wants to help local businesses can expect an average gross return of between 5% and 8%. However, in some markets, returns of 14% or even 16% could be achieved. Lenders spread their investment risk in £25 chunks and pay a low fee of just 1%.

Says Managing Director Mark Ashton, There's a slightly higher risk for investors than taking out a High-Street cash deposit. But then the returns are much greater. With our close scrutiny we are hoping for levels of bad debt of less than 1%. But we think that business without the banks is the way forward. Anyone who registers with us will also be backing British business at a crucial time.

We'd also love business borrowers to encourage their employees, friends and family to contribute to the loan. That way, they can support their business. After all, they're the ones who know most about how good their trading prospects are. It all adds to the community spirit. Businesses can register with Big Carrots at www.bigcarrots.com.