Small business lender Funding Circle increased the amount of cash it lends to SMEs by 23 per cent to £644 million in the first three months of this year.

Of this, £419 million has gone to British SMEs alone.

Funding Circle also lends to small businesses in Germany, the Netherlands and the US.

In 2018 Funding Circle lent £2.3 billion to small business across all four territories, of which the UK carved out a £1.5 billion share of peer-to-peer business lending.

The total amount of private investor cash Funding Circles manages increased by 44 per cent to £3.4bn in the first three months of this year – a record high. The UK accounted for £2.4 billion of this total.

Revenue growth also shot up by 40 per cent.

Yesterday, the European Investment Bank agreed to lend €100 million over the next two years to small businesses in Germany and the Netherlands through Funding Circle.

The P2P fund has also announced two institutional investor products to launch in 2019, private direct lending funds to be launched in the UK and continental Europe and bond products also to be launched in the UK and US.

Funding Circle co-founder and chief executive Samir Desai said: “Q1 was a period where Funding Circle reinforced its leadership position across each of its markets, reaching a new high of loans under management of £3.4 billion.

“We continue to implement our strategy of diversifying funding sources with a new commitment from the European Investment Bank, as well as launching two new institutional investor products.”

Earlier this month, Funding Circle announced it was closing its separate publicly quoted SME fund and returning capital to shareholders. The idea was that the listed fund would allow individual investors to invest in a portfolio of Funding Circle’s small business loans.

Last November, the British Business Bank announced it would commit to lending up to £150 million to UK small businesses through the P2P lender, while in December Waterfall Asset management agreed to invest in £1 billion of loans through the fintech giant’s UK platform over a two-year period.