The Global Alternative Finance Market Benchmarking Report: Trends, Opportunities and Challenges for Lending, Equity, and Non-Investment Alternative Finance Models (Cambridge Centre for Alternative Finance)

Summary

• Alternative finance platforms facilitated $304.5 billion in 2018, a 27% fall from 2017's $419 billion, driven by a sharp decline in China.p.32
• Excluding China, alternative finance grew by 48%, from $60 billion in 2017 to $89 billion in 2018.p.32
• P2P/Marketplace Consumer Lending was the largest model in 2018 at $195.29 billion, or 64% of total global volume.p.24
• Business funding through alternative finance reached $82 billion in 2018, down from a high of $153 billion in 2017.p.24
• European alternative finance, including the UK, grew from $11.9 billion in 2017 to $18 billion in 2018, a 52% year-on-year increase.p.25
• China accounted for 71% of global volume, followed by the US (20%) and the UK (3%).p.33
• 1,227 unique firms contributed, providing 2,322 firm-level observations, and 47% operated in two or more jurisdictions.p.23

Key insights

1. Alternative finance volumes fell by 27% from $419 billion, mainly due to a sharp decline in China.p.32
2. China's share of global volume shrank from 86% in 2017 to 71%, largely explained by regulatory enforcement efforts.p.32
3. P2P/Marketplace Business Lending was the second largest segment, generating $50.3 billion in 2018.p.24
4. Approximately $162 billion of volumes stem from institutional investors such as banks, pension funds, mutual funds and family offices.p.24
5. The UK represented 57% of the European market, accounting for $10.4 billion in 2018.p.25
6. The Netherlands became the top-ranked European country after the UK, with $1.8 billion in 2018.p.25
7. The Latin America and Caribbean region grew by 173%, from $663 million in 2017 to $1.81 billion in 2018.p.26
8. Online alternative finance in Africa grew by 102%, from $103.8 million in 2017 to $209.1 million in 2018.p.26
9. Platform closure in China over the last year was 46%, following enforcement efforts by the authorities.p.30