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Crowd2Fund Review
Crowd2Fund and its small-business loans have been struggling and time is running out to demonstrate sufficient improvement.
Crowd2Fund's Business & Property Lending is unrated, due to lack of data.
There's not enough information to estimate lending rates after losses from bad debts.
Visit Crowd2Fund or keep reading the Crowd2Fund Review.
What is Crowd2Fund?
Crowd2Fund does small business peer-to-peer lending. Businesses borrow through Crowd2Fund for all the usual reasons: to consolidate debt, for growth and expansion, and to cover working costs when there’s a shortfall.
Loans are usually for 36 months and the borrowers must make monthly loan and interest payments to you.
Crowd2Fund previously offered four other higher-risk products to its borrowers, funded by individiduals through its online platform. These have been discontinued or are now very rare, even though they are still shown on its website. We have no information on how well these performed.
When did Crowd2Fund start?
It started peer-to-peer lending in 2015 and by autumn 2025 has lent £50 million.
What interesting or unique points does Crowd2Fund have?
Crowd2Fund is a rare P2P lending provider in two ways: in that it offers lenders the opportunity to lend in small business loans and that it lets lenders choose their own loans.
In choosing their own loans rather than using the auto-lend feture, lenders attempt to achieve better than average results compared to others using Crowd2Fund. You’re able to ask prospective borrowers questions.
Crowd2Fund review: how good are its loans?
Due to lack of data, I can only give you a superficial opinion on how good the loans are.
We can’t, for example, evaluate what is called heterogeneity, which in this case means how well Crowd2Fund grades the borrowers and prices the loans. But even more basic assessments are largely out of reach.
What I can tell you is that Crowd2Fund has historically funded the higher-rate, riskier end since it started and it continues to do so. Therefore, you should expect many borrowers to become unable to repay.
Crowd2Fund tells me it historically hasn’t been good enough at recovering bad debts. More recently, it’s been focusing resources to improve this area.
The loans are unsecured, meaning that Crowd2Fund can’t as easily seize or sell the borrowers’ properties, or other major assets owned by the borrower, in order to recover a bad debt. Your main defence against risk for these kinds of loans is to lend to a lot of different borrowers at high enough interest rates.
How much experience do Crowd2Fund’s key people have?
Public information about people working at or for Crowd2Fund frequently conflicts with what Crowd2Fund itself has stated, while profiles on its website about who is on its current team, and what their roles are, have sometimes been years out-of-date. Plus, consultants working very closely with Crowd2Fund at a senior level don’t always choose to reveal the connection in their social-media profiles.
We never received responses to our queries about the above discrepancies in the past, so we stopped asking at some point.
Staffing at all levels has been very unstable, including key people in the lending team, who have changed a lot over the years. Past attempts to hire and train them have so far failed to deliver results where they need to be.
However, in summer 2025, for the first time in years, I had a chance to interview two key people and run checks, and understand who else is on the core team is now.
The key rainmaker – in terms of setting criteria for assessing borrowers and approving loans, as well as setting interest rates and containing other risks – is something of a multi-talent in terms of the breadth of banking and risk roles he’s filled. Much of this experience is directly useful for his wide remit.
Yet I can find no specialised education or roles that are specifically and mostly focused on heading credit or credit risk as his main function to the extent that we like to see for small business lending in particular.
That’s why I was pleased that he brought in a consultant to help for a couple of years.
While I did not interview this consultant, it seems his experience is likely more focused specifically on credit risk and appears to be fairly impressive. I would ideally like to have seen some evidence of formal education specifically on credit-risk methods, including quantitative-risk assessments, to round him off some more.
I also interviewed the senior person brought in to improve recovery of bad debt. He has a long history in property lending, but not the extensive experience that I would like to see in small-business lending – and specifically in chasing and recovering small-business bad debts.
Crowd2Fund review: lending processes
Approving loans
Over two-and-a-half years ago, the current team did a thorough review of the credit policy that left nothing unchecked and they rewrote the policy from the ground up.
For the first time since then, I’ve had an update on Crowd2Fund’s lending processes, albeit just a broad-brush take.
The loan assessment process is fully manual with no automation. Personally, I would prefer that automated decisions form part of the assessment, even though their loan history is on the small side for refining algorithms.
For context, this is lending in a space that has a lot of competition from banks and other lenders. And Crowd2Fund, in my opinion, is in very urgent need of having more loans and more lending to earn sufficient fees to stop haemorrhaging cash and stabilise its own business.
Those business pressures can conflict with rigorous lending policies and I think it’s much easier for such pressures to influence lending decisions when they’re 100% manual.
Nevertheless, it’s good to see that Crowd2Fund uses a scorecard approach combined with Equifax scores. Such systems increase accuracy for these kinds of loans and reduce the potential for conflicts of interest to have an impact.
That said, it appears – from the outside at least – that Crowd2Fund might switch to Experian if a better score there helps it justify approving a loan. While I highly approve of using two credit-reference agencies simultaneously by default (that is the gold standard), using one and then sporadically another is potentially undesirable flexibility.
It’s not terribly useful to comment on Crowd2Fund’s range of borrowers based on the borrowers’ Equifax scores, as that is just one piece of an overall puzzle when assessing loans. However, it’s clear that Crowd2Fund is willing to go some way along the risk scale. That is to be expected, considering the high rates that Crowd2Fund charges.
I don’t like that it seems very willing to go beyond its stated maximum range: it represents the Equifax scores it accepts as letter grades from A to D, but in very recent times it has gone to E grade (such as scores of 26/100) and also approved loans from borrowers with no Equifax score.
That is even as I was told that it “used to be broader” than A to D, but they “narrowed it down, because investors have to be protected”.
Crowd2Fund does a lengthy manual assessment. This involves the essential fraud checks, looking at the business borrowers’ company accounts, cash flow in and out of the business, ability to meet loan payments, and at the directors.
It diligently looks for discrepancies, e.g. by comparing open-banking data to look for hidden loans, and looking at management accounts (which could be useful when an Equifax score is out-of-date).
Crowd2Fund takes guarantees from the directors, as has been its long-standing practice. This means it can attempt to go after the directors’ personal property, money and other assets if the loan goes wrong.
As all of the specialists at 4thWay have explained to you since we started in 2014, and based on decades of prior banking experience, you can’t put any weight on guarantees without evidence to show their value. (Crowd2Fund has admitted its past results in both loans turning bad as well as recovering bad debt were not good enough, so it’s a case in point.)
I have also been told of a potentially important change in recent years, which is removal of the founder from the lending-decision process. This reduces the impact of commercial needs on sound verdicts.
However, its credit committee still includes the current CEO. While he’s not a founder, he’s a businessperson with no credit experience and therefore he has no place taking part in credit-committee decisions.
Certainly, he can inform the head of credit about what Crowd2Fund’s board believes is an appropriate risk appetite for lenders, but the credit committee’s approval decisions should be separated from that.
I would have wished, especially in these circumstances, that the committee’s decisions to approve a loan had to be unanimous, but they are by majority. The head of credit does, however, have a veto – although he’s not always in the rota to take part on the committee.
Crowd2Fund allows borrowers seemingly to raise whatever they can through its online lending platform and then come back for another tranche – or even a third. This disturbs me a great deal. With a small business loan, either borrowers receive all the cash they need for their plans or they don’t get any money.
This hybrid of getting what you can and seeing if it’s enough, or seeing if they can raise more, seems most likely driven by Crowd2Fund’s great difficulty in getting enough quality borrowers and enough different lenders to fund them.
In a similar vein, I find it odd and faintly perturbing that the vast majority of loans and tranches I reviewed seem to be for 36 months. At the very least, it’s a bad look, as it makes it seem that Crowd2Fund might not be considering the specific needs, or repayment capabilities, of the borrowers.
Crowd2Fund doesn’t do the kind of routine, bank-like quantitative-risk modelling that we hope to see for these kinds of loans, although admittedly such modelling is not easy until it has approved thousands of loans.
Recovering bad debts
With unsecured, small business loans, quality of the loans usually beats ability to recover bad loans. It’s hands-down more important and more impactful.
But good recoveries are still usually necessary to get overall returns to an acceptable level.
Banks and other loan providers have a duty to try to work with borrowers who are in trouble and Crowd2Fund, too, takes a sympathetic approach, with a view to arranging plans to get something back for lenders. In its words, treating each borrower “on its own merits”.
However, for small-business lending like this, I still would have wanted to see more rigidity and firmness in the steps it takes immediately after the first signs of problems start to arise and the first payment is missed. The reason being that once a default occurs there’s a high chance of losses, but, generally speaking, the faster steps are taken, the better. It appears from limited information that Crowd2Fund has historically been very slowly to recognise various bad debts.
I don’t know why Crowd2Fund’s recoveries have previously been below par. Perhaps it was all down to slow reactions – or not. But, without clear rigour in their new approach, I also can’t see what it’s doing differently that makes them think it will improve.
How good are Crowd2Fund’s interest rates, bad debts and margin of safety?
We have insufficient information on the annualised returns earned by lenders.
Broadly, you’re looking at above 12% on average – ranging from 10% to 19% – after all costs but before losses from bad debts.
The Crowd2Fund website shows you the rates before all direct lending fees are deducted. You’ll receive about one percentage point less than the rate shown – provided the borrower repays in full.
Piecing together all the limited and unverified information available, it seems probable that most Crowd2Fund lenders have historically made money, if they have made good effort to spread across many loans. However, I think it is likely that a substantial minority of lenders have lost money, or are on track to do so, even when doing their best to spread across lots of different borrowers.
We have a few recent statistics on loans over a year old and under two-and-a-half years old. I find these figures very concerning, considering that the loans were all approved after Crowd2Fund’s major re-write of its lending policy:
So Crowd2Fund needs to show that it has a grip on things. To that end, these loans really need to have a large reversal in fortunes, possibly by the end of next year, or Crowd2Fund must provide seriously detailed data and context to reveal important nuance to these figures.
We don’t know if Crowd2Fund has been kicking problem debts down the road. This is when a P2P lending site either extends bad loans, doesn’t recognise them as bad debts, or re-arranges existing loans to make it easier for distressed borrowers to appear sound for as long as possible.
We also don’t know how much actual performance has been blurred through payments Crowd2Fund itself has made to lenders to partially cover bad debts.
Has Crowd2Fund provided enough information to assess the risks?
I am so glad that I was able to interview the two key people recently, as well as the CEO earlier this year. And they were candid about their past problems that they are trying to fix now.
In terms of data, we get close to nothing from Crowd2Fund.
As of autumn 2025, Crowd2Fund continues to provide confusing, conflicting and limited information to the public. Statistics even differ on different pages when they have the same timestamp. Combined with the unreliability and lack of depth in the qualitative information about Crowd2Fund and its team, I find that the information provided is deeply insufficient for potential lenders at home trying to come to a view on the risk-reward balance.
It’s also, in my view, sometimes misleading. For example, instead of stating that its high double-digit lending rates are because of the risks involved, it says the reason is that you’re lending in “directly to handpicked opportunities, cutting out the middle man”. Or another corker: “Our target default rate is 0.5%”: but it has never got anywhere near that low.
Crowd2Fund’s definition of “default rate” is based on the pound amount that has turned bad versus the amount lent. The term “default rate” is used differently between P2P lending providers and also often differs with the standard definition used by regular banks.
Crowd2Fund lenders might also rightly be disappointed that they are not handed more details on a plate when they are selecting individual loans for themselves. I find it sparse.
Even the head of credit was unable to provide a verbal summary of how their loan book is doing, stating that data had “not been made routinely available” to him. So even internally there is not enough data.
Is Crowd2Fund profitable?
Crowd2Fund has been highly innovative in technology, in finding new types of loans, in how it provides guidance on the loan price you should go for when selling loans second hand, in automations and more. Yet its business has been struggling badly.
It has made annual losses of £800,000 to £1.2 million for six years. At the same time, its average revenue has been around £400,000. It has earned even less than that in the past three to four years.
It’s inconceivable that Crowd2Fund will make a profit in the coming year and it is relying on loans from its shareholders.
A few years ago, Crowd2Fund replaced its people, including its board. It also cut costs, changed its strategy, then increased marketing spend.
In a recent report, it said it had again restructured its board, appointing new directors, and announced more cost-cutting and other measures. And then, at the beginning of 2025, it appointed another new CEO.
Now, all those plans to survive and turn its business around have been put in place, but it will require an awful lot to turn out right. Its independent auditors have noted “material uncertainty” that Crowd2Fund will survive.
Crowd2Fund has sold over £4 million of its shares to its investors over many prior years and borrowed seven-figure sums from them. I still think it will need a lot more of this before it becomes profitable.
Is Crowd2Fund a good investment?
Crowd2Fund’s own financial situation is precarious and, by Crowd2Fund’s own figures, half of its loans issued since radically redoing its lending policy have fallen into default.
I really hope that the coming 12 months show a remarkable shift, but it’s not possible at this stage to call Crowd2Fund a good investment.
What is Crowd2Fund’s minimum lending amount and how many loans can I lend in?
You can lend as little as 10p per loan.
If you want Crowd2Fund to automatically lend your money across different loans, the minimum is £100.
You can automatically lend new money on a monthly basis. You can also increase the rates you want to lend at (which likely at least loosely correlates with greater risk) or decrease them.
Crowd2Fund last told me that, when lending automatically, it ensures that you only lend once to the same borrower, at any one time. But that was a while back; I regret I forgot to confirm this is still the case before going to print.
However, even if you dripped your money in, lending regularly over a large number of months, I am not sure how you might have diversified sufficiently.
I currently estimate you need well in excess of 200 loans from as many unique borrowers to attempt to contain risks. But, over a recent 18-month period, there were just 113 loans to just 86 borrowers.
To put this in perspective, Crowd2Fund approved maybe £1.6 million in the past 12 months. Many years ago, at its peak, it was closer to £10 million in a year.
To diversify sufficiently, then, you have to underweight Crowd2Fund and put more in other lending accounts and investments, so that you’re still sufficiently spread across each of your individual loans and investments in your entire investing portfolio.
Does Crowd2Fund have an IFISA?
Crowd2Fund’s lending account is primarily sold as an IFISA, although it tells me it offers an ordinary P2P lending account as well. If you put in more cash than your IFISA limit, the excess lending will be outside of the IFISA.
Can I sell Crowd2Fund loans to exit early?
You can sell Crowd2Fund loans to other lenders, before borrowers repay them naturally. You can only do that if the loans are in good standing and if Crowd2Fund has graded the borrower’s recent Equifax score as A, B or C.
Crowd2Fund sets a price range that you can offer your loan parts at. In other words, you can sell your loans at more than their face value if there is sufficient demand, or less if demand is low or you’re in a hurry to exit.
The price range Crow2Fund sets is based on loan performance, recent business performance and recent Equifax scores.
I saw no loan parts for sale last time I checked, so I’m not sure how easy it currently is in practice to buy or sell on its secondary market.
Crowd2Fund in a wind-down
Crowd2Fund’s wind-down plan suggests that if it were to go bust then its backup provider, EQ, has the same regulatory permissions as it does.
A check with the Financial Conduct Authority finds that the company that uses the trading name “EQ” doesn’t have the main permission for P2P lending, which is operating an electronic system in relation to lending. Nor does it have permission to control your money. These are very big differences with Crowd2Fund and could be problematic.
Crowd2Fund’s plan also warns that loans in wind-down may not be managed any more if Crowd2Fund fails and that, if they are managed, regulatory protections might be reduced or no longer available.
What more do I need to know?
There are connections between one of the owners of Crowd2Fund and former cabinet ministers Matt Hancock and Nadhim Zahawi, as well as offshore trusts, tax rows, undeclared connections and so on.
If you’re interested in your own research on that, you could begin with a brief summary of what I consider to be just a small part of the story from here. Anyone who feels motivated to investigate further might read the wording used by the people involved very carefully.
Visit Crowd2Fund. If you’ve found the Crowd2Fund Review educational, please check out our other reviews.
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