A new app that uses friends and family to borrow and lend money rather than banks or payday loan companies is the subject of a new crowdfunding campaign.

Flender wants to bring an added element of trust to money lending by enabling users of the service to source it from their social network accounts – engaging with contacts in peer-to-peer lending rather than using a loan company.

The app, which is currently seeking funding via crowdfunding site Seedrs, says that while the idea of peer-to-peer lending already exists, it wants the app to become the first to “formalise and automate” the process.

How? Well, Flender says it will allow users to set their own interest rates when entering into loans, with both sides agreeing on the terms before proceeding.

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The firm says this formal aspect will help to reduce or even remove any potential awkwardness between users.

Flender says the app is aimed at businesses as well as regular consumers and could be used as a tool for small companies to build trust with customers.

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(Gareth Fuller/PA)

 

Kristjan Koik, managing director of Flender, said: “The social lending market among friends, family and business connections has never been formalised, which is crazy when you consider that this is a market worth just under £3 billion a year.

“Asking people you know for money – and lending to them – is awkward and is certainly an unreliable means of finance. Whether it’s to grow your business, fund further study, or to fund home improvements, Flender will let you borrow from and lend reliably and easily via any device.

“For individuals, there is satisfaction of helping others while earning more interest than a standard savings account while businesses can have access to funds faster and at their preferred rate. Everyone wins.”

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