How Esme Loans Tapped Advanced Technology To Fuel

Its 300% Growth Ezbob, once an SME lender, enables Esme

Loans to provide fast credit decisions.

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Founded in 2016 with the backing of NatWest, Esme Loans, a digital lending platform for the UK’s SMEs, was conceived by a NatWest innovation cell in response to the rise in alternative lending fuelled by new and innovative technologies. Having worked within the RBS group for over a decade, the original founding team, Richard Kerton, Veronika Lovett, Lucy Hasson and Mark Watson had identified a clear market opportunity to enhance customer experience in the SME lending space. “We believed that customers would be extremely willing to move to non-bank brands in search of a quicker decision,” explains Hasson, Chief Operating Officer at Esme Loans. “There was an obvious appetite for a straight-through-processing digital decision, and that was something that the high-street banks were unable to offer.” The team approached Ezbob, which was still actively lending in the UK market at the time, to find out whether its advanced lending technology could be leveraged to help bring the Esme Loans concept to life. Discussions progressed well, a new partnership was forged, and working together, Esme Loans was launched to market within 9 months.

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Rapid Growth Powered By A Digital End-To-End SolutionEsme’s subsequent growth has been remarkable. At launch, it offered loans from £25,000 to £150,000 but has now increased this limit to £250,000 as it continues to expand its customer base. Esme now offers unsecured business loans to businesses from £10,000 (or from £25,500 for sole traders) to £250,000 and has lent more than £149m to small businesses throughout the UK. “We first launched into the market in March 2017, piloted the business and then properly launched to scale in 2018,” says Kerton, Esme’s CEO. “I’m pleased to say that we grew by over 300% in 2018, and then another 300% in 2019. We’re pretty well spread across all sectors, and that’s deliberate because we wanted to ensure that we’re open to business. Our smallest customer turns over £100k and our largest does £75m – it’s quite a range.” “We chose to partner with Ezbob because it provided us with the best end-to-end digital solution that gives us the ability to make quicker lending decisions. It enables instant decisions and also means that we can manage customers in a completely digital environment, from the initial application right through to the last repayment.” “We have a very competitive product,” he adds. “There aren’t many banks or fintechs that will offer unsecured lending up to £250k,

“ Our customers benefit from

the speed and convenience

of execution that’s enabled

by Ezbob’s technology. ”

at competitive rates. Our customers benefit from the speed and convenience of execution that’s enabled by Ezbob’s technology.” The relationship with Esme Loans has acted as the catalyst for Ezbob to strategically pivot and become a fully-fledged technology company, as opposed to a lender in its own right. Ezbob today offers one of the only bank-grade, automated solution for SME lending that covers the entire user journey, as well as all aspects of compliance, risk and decisioning. The award-winning Ezbob solution taps into the data-rich Open Banking environment and aggregates information from over 40 different data sources, presenting better data that leads to better risk management and more informed credit decisions. This ensures that Esme can make the right lending decisions, and fast. Decisions and offers can be made within minutes and the money is transferred without any human intervention. For those lending decisions which can’t be automated, Ezbob’s advanced underwriting (UW) system presents customer profiles in a single-page summary. The intuitive UW dashboard allows Esme’s underwriters to process applications in minutes, so even when a manual decision is required, customers can get an answer quickly.

Once a customer turns to Esme for a loan, it’s Ezbob’s technology that provides the data that enables Esme to assess the application swiftly and accurately. “Ezbob aggregates data into one central place to help us assess it quickly,” says Hasson. “That ability to pull in all the data from multiple sources as the customer is going through the application process, is a real benefit for us. We can then use that data to make the right decisions in terms of risk appetite, affordability and so on.”

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Transform your lending

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Lucy Hasson Chief Operating Officer of Esme Bank

“ That ability to pull in all

the data from multiple

sources as the customer is

going through the

application process, is a

real benefit for us. “

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Transform your lending

https://ezbob.com ©ezbob, Ltd. 2020

Adjusting to the COVID-19 environment

Like every organisation, Esme has been impacted by the COVID-19 pandemic, but it has quickly found the positives. “Our Q1 volumes had us firmly on track to grow another 300% in 2020 before COVID-19 hit,” explains Kerton. “Since Q2, our focus has been very much on supporting and working with our existing customers through this period. We know that SMEs are faced with uncertain and unprecedented times, and we’re keen to help.” The team is passionate about working with small businesses to help them; an ethos more important than ever before as we collectively face unprecedented challenges. This approach is paying off. Esme’s Trust Pilot score currently stands at 4.5 stars out of five and the lender boasts a Net Promoter Score

(NPS) of 75, which is higher than a number of banks. “For new brands, like Esme, being trusted is the most important thing” adds Hasson. “Our Trust Pilot score gives us more credibility in the market. It helps us to attract more businesses to Esme so that we can have that conversation about how we can help them.” As 2020 draws to a close, and the government loan schemes come to an end, Esme will be going back out to market with a renewed appetite. “In the last few years, we’ve seen the SME sector thrive in the UK, with many promising businesses emerging and showing disruption and innovation,” says Kerton. “Whilst COVID-19 has understandably interrupted things, we’ll be ready to continue lending to ambitious SMEs as they lead the country’s economic recovery.”

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