Frequently Asked Questions

What am I investing in?

Funding Circle connects businesses seeking loans with investors like you. As an investor on our platform, you are purchasing interests in business loans originated by Funding Circle. More specifically, you are buying promissory notes issued by Funding Circle Notes Program, LLC, privately placed by Funding Circle Securities, LLC, member FINRA/SIPC, and which are dependent for payment on corresponding loans originated by FC Marketplace, LLC.

You collect on 100% of your pro rata share of the principal and interest (after the servicing fee) as businesses repay their loans, and you hold the entirety of the risk. No claim may be made against Funding Circle (or its affiliates) for shortfalls resulting from loan defaults.

What is your minimum investment?

The minimum commitment to invest on the marketplace is $25,000. The minimum amount you can invest per note is $500.

What fees do you charge?

Funding Circle charges a 1.00% servicing fee, which is applied as a 1/12th of 1% (0.083%) monthly fee on the unpaid principal balance of outstanding loans. This fee is assessed by Funding Circle Notes Program and is deducted from borrower payments on the loans underlying your Notes. Funding Circle Securities does not charge any separate or additional brokerage account or transactional fees.

Who can invest?

At this time, investment on our platform is only open to accredited individual and institutional investors.

What is an accredited investor?

To qualify as an accredited investor, an individual must satisfy one of the below conditions:

  • Earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and a reasonable expectation of the same for the current year, OR
  • Has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence).

You can find more details on the U.S. Securities and Exchange Commission website. We verify the accredited status of investors participating on our platform.

Why do you need to ask suitability questions?

Funding Circle is required to ensure that your goals and experience as an investor are aligned with this investment opportunity. The suitability section of your investor profile helps us understand your investment experience and objectives, liquidity needs, and risk tolerance. This information will not be used for marketing purposes and will not be sold, rented or loaned to any third party. You can learn more on the FINRA web site.

How It Works
How does the investment process work?

  1. Sign up and fund your account1
  2. Once you’ve signed up for an account and we’ve securely connected your bank account, we will verify your accredited investor status. You can then transfer a minimum of $25,000 into your investment account.

  3. Invest in loans
  4. Funding Circle funds loans for small businesses and makes them available to you as Notes, representing portions of the loan. Our Auto Invest tool will automatically invest your money in creditworthy small business loans. Or, if you prefer, you can choose individual Notes in our pick-and-choose marketplace. Put as little as $500 into each Note using Auto Invest or the pick-and-choose marketplace.

  5. Track your investment performance
  6. Borrowers repay loans through fixed monthly payments. As a Notes investor, you will receive shares of each payment on corresponding loans (net of the servicing fee). Log in to the Investor Portal via web or mobile app (iOS or Android) at any point to see how your investments are performing and get summarized statistics for your portfolio.

  7. Reinvest your earnings
  8. As long as you keep Auto Invest active, your repayments will be continuously lent out again on newly originated loans. This helps your interest to compound. Our tool will automatically continue investing, ensuring your money is being put to work for you.

How can I see the performance of my investments?

After you have set up your account you will have access to our Investor Portal, which allows you to access the marketplace, view your portfolio, monitor returns, and much more. You’ll also receive monthly account statements with investment information including portfolio holdings, payment history, and unpaid principal balance.

How does Auto Invest work?

Auto Invest allows you to specify term and risk band criteria that you would like to automatically purchase. You can turn Auto Invest on and off within the Investor Portal. There is no cost to participate, and it can be shut off at any time.

By keeping Auto Invest active, our tool will keep reinvesting your repayments and any available funds. This helps your interest to compound, and helps you to maintain a diversified portfolio.

Can I pick my investments?

We encourage you to use Auto Invest to build a diversified portfolio. However, automated investing is optional. You can browse the marketplace within the Investor Portal to search for investment opportunities that suit you, subject to diversification requirements.

What information do I get about the businesses receiving loans?

The Investor Portal gives you the ability to view information such as the businesses’ locations, industries, years in operation and number of employees. You can also view the businesses’ financial details and see key attributes of the corresponding loans, including coverage ratios, existing debt obligations, and guarantors’ credit score ranges. Please note, credit information and FICO scores may be based on outdated, incomplete or inaccurate credit reporting data.

Only businesses in operation for two years or more that have passed our credit assessment process can borrow through Funding Circle.

When are new loans listed?

Loans are listed at 1 p.m. Pacific Time with a one hour preview period beginning at 12 p.m. Pacific Time.

How do I withdraw my money?

As you set up your profile, you will provide a bank account to be used for deposits and withdrawals. You can withdraw your repayments as they come in, if Auto Invest is turned off, as well as any of your funds that aren’t lent out. There are no fees to make a withdrawal.

Can I sell my loan parts to other investors?

No, Funding Circle does not offer a secondary marketplace in the United States at this time. You should invest with the intent and expectation of holding purchased loan parts until maturity.

Can US investors invest in loans to businesses in Funding Circle’s other geographies?

At present, US investors are only able to invest in loans to US businesses.

Managing Risk
What kind of businesses receive loans?

Funding Circle’s borrowers are established, creditworthy businesses in different sectors and regions throughout the United States. They may use their loan for a wide range of purposes, such as to hire staff, buy new stock or equipment, expand their marketing, or open new locations. All businesses are at least 2 years old, but the average is 11 years old.2

Funding Circle does not extend credit to businesses in certain industries including speculative real estate, nonprofit organizations, weapons manufacturers, gambling businesses, marijuana dispensaries, and pornography.

How does Funding Circle underwrite loans?

Only businesses who have passed our holistic credit assessment process can borrow through Funding Circle. Our credit assessment team holds decades of experience from some of the world’s leading financial institutions. They use thousands of data points, innovative technology and their detailed understanding of business lending to assess every application, so only creditworthy businesses are approved. Funding Circle takes numerous measures to validate credit data. However, even with these efforts credit information of a borrower may be inaccurate or may not accurately reflect the borrower’s creditworthiness. Any such inaccuracies may be manifested in payment defaults on the borrower loans.

What risks are involved in investing?

Investing in small business loans carries risk. Your returns depend entirely on payments received as business owners repay their loans. If a business is late on their payments or defaults on their loan, your returns will be correspondingly late or reduced. It’s important to remember that some businesses will not be able to fully repay their loan. A full description of the risk factors involved with investing can be found in the Private Placement Memorandum (PPM), shared with you during your account setup.

To earn a more stable return, we encourage you to build a diversified portfolio by splitting your investment into lots of small pieces. Auto Invest makes this easy to do, so you can relax as you invest in financing to many different businesses.

Are the loans secured?

Every loan is secured by the non-real estate collateral of the business (perfected by a UCC-1 financing statement), and we also require the significant proprietors of the business to provide a personal guarantee. We do not have specific collateral requirements; collateral can include, but is not limited to, equipment, vehicles, accounts receivable, and inventory.

How do you service the loans?

Funding Circle collects repayments from businesses and credits the funds to your Notes. When businesses are late or unable to fully repay their loan, our collections and recoveries team will work to recover as much as possible for you.

FC Marketplace, LLC is the servicer of record on every loan we underwrite and originate. We may utilize partners or sub-servicers to conduct some servicing operations such as payment processing, borrower customer service, delinquency and default management, and other debt and loan collection services on Funding Circle’s behalf.

What happens if a business is late on their payments or defaults on their loan?

Funding Circle’s collections and recoveries team pursues every single late or defaulted loan to recover as much as possible. They use a variety of methods and technologies that analyze the specific financial situation of each borrower to maximize your recovery.

When a loan defaults, your account will show a total loss of principal. However, our team will continue to work to make recoveries, so it’s worth remembering that the amount “lost” on recent defaults may improve over time.

Please note, a personal guarantee, or any form of security, does not ensure a full recovery of outstanding debts will be made if a loan defaults. There may be instances where no recovery can be made.

Can the loans be repaid early?

Yes, businesses can repay their loans early without a prepayment penalty. If this happens, your outstanding principal will be returned to your investor account where it can be lent to other borrowers.

How is Funding Circle regulated?

We believe that full and strict adherence to regulations is essential to protect both our investors and borrowers, and build a sustainable business. Funding Circle Securities, LLC is a Financial Industry Regulatory Authority (“FINRA”)-registered broker-dealer and placement agent for the Notes, a private offering of securities. As such, Funding Circle's securities operations are regulated FINRA, the Securities and Exchange Commission, and by each state in which it offers securities (pursuant to the specific state's blue sky laws).

In addition, as a California Finance Lender, Funding Circle's lending operations are directly regulated by the California Department of Business Oversight. Additionally, Funding Circle is subject to the state laws of each jurisdiction in which it offers and funds loans. On a federal level, Funding Circle's lending operations are subject to specific statutes enforced by the Federal Trade Commission, the OCC, as well as other federal agencies.

Funding Circle helped establish self-regulatory bodies in both the United States and United Kingdom, and was a co-author and signatory of the first-ever US Small Business Borrowers’ Bill of Rights.

How is Funding Circle prepared for an economic downturn?

Funding Circle closely monitors external macroeconomic conditions in addition to the performance of loans. Where signs indicate worsening conditions, we will make credit strategy changes to favor investor yield for new loans.

In addition, we regularly perform stress tests to simulate what could happen to investor returns during difficult periods, for example during an economic downturn. This is just one of many steps we’ve taken as part of a comprehensive, data-driven approach to risk management at Funding Circle.

Taxes and Reporting
This section is provided for informative purposes only. Please contact your tax professional for additional questions or concerns.
What kind of financial reporting will I receive?

Investors receive account statements on a monthly basis through the Investor Portal that detail their investment information including portfolio holdings, payment history, and unpaid principal balance.

Do you withhold any taxes?

No, we do not withhold any taxes. Please consult your tax professional to address your specific taxation requirements.

What tax forms do you provide investors?

Funding Circle USA provides investors on the marketplace with IRS Form 1099.

Information Security
Is the information I share with you secure?

We take the privacy and information security of our investors, borrowers and partners incredibly seriously, and are committed to providing the best level of protection for our customers and their data.

Here are just some of the policies, practices, and technologies that enable us to do this:

  • Employing a dedicated and experienced security team that is responsible for setting and ensuring the company’s compliance with security policies and standards;
  • Performing regular penetration tests against our environments;
  • Complying with security regulatory requirements including PCI-DSS;
  • Employing security technologies like firewalls and scanning to protect our systems and data from attackers and malicious software; and
  • Ensuring access to systems and data is appropriately restricted only to those that need to have that access.

Read our investor privacy policy for more information about how we collect, store and use data.

What is phishing? How do I know this email is really from Funding Circle?

Phishing is a method used by fraudsters to access valuable personal details by pretending to be someone they’re not, such as posing as Funding Circle. Phishing communication can involve the sending of emails, letters, text messages, or even phone calls.

Communication from Funding Circle will:

  • Never begin greetings with vague wording such as “Dear Customer” or “Dear Valued Customer.”
  • Never ask you to provide both your Funding Circle username and password.
  • Never claim to be one of our investors.
  • Never ask you for your credit card information.

What should I do if I suspect phishing?

If you think an email is fraudulent, immediately contact our investor success team or reach out to our security team at You may also wish to report your incident immediately to the FBI’s Internet Crime Complaint Center (IC3).

It is important for you to alert us to a potential scam before providing any information to the fraudster. Unfortunately, in the majority of cases, Funding Circle will be unable to recover any money paid over in a scam.

[1] Investors must receive and agree to the terms and conditions and to having read and understood the Offering Materials, including all material risks, as a prerequisite to opening an account with Funding Circle Securities.
[2] Characteristics of previous and current U.S. borrowers as of March 31, 2019.
[3] A UCC-1 financing statement is a legal form a creditor files to give notice that it has or may have an interest in the property of a debtor.

Funding Circle allows investment in U.S. small business loans on its platform through private placement of notes (“Notes”) by Funding Circle Securities, LLC (“Funding Circle Securities”), member FINRA/SIPC. [Check the background of Funding Circle Securities LLC on FINRA's BrokerCheck]. Notes are issued by Funding Circle Notes Program, LLC (“Funding Circle Notes Program”) and are promissory notes that are dependent for payment on payments that Funding Circle Notes Program receives from corresponding business loans originated by an affiliate. Funding Circle Securities only offers investment products and securities of its affiliates. Notes are only deemed suitable for Accredited Investors, as defined by Rule 501 of the Securities Act of 1933, who are familiar with and willing to accept the higher risk associated with private investments. These securities are not publicly traded and may be subject to holding period requirements. Any investment in Notes is subject to various risks due to, among things, interest rate risk, credit risk and regulatory risk, none of which are outlined herein. Such risks are discussed in confidential offering materials and related documents (the “Offering Materials”). Investing in private placements offered by Funding Circle Securities requires a high risk tolerance, low liquidity concerns and long term commitments. Investors must be able to afford to lose their entire investment. Carefully consider the investment objectives, risk, charges and expenses of any investment product prior to investing. No communication, through this website or in any other medium, should be construed as a recommendation for any security offering. This website provides general and preliminary information about securities offered by Funding Circle Securities and is intended for initial reference purposes only. It is not a summary or compilation of all applicable information and is not complete. This website does not constitute an offer to sell or buy any securities by Funding Circle Securities. There shall be no offer or sale of any securities without the delivery of the Offering Materials. The information contained herein is qualified by and subject to more detailed information contained in the Offering Materials.