Kuflink enters £35m institutional debt funding agreement with Paragon Bank

The arrangement was placed by investment finance group European Risk Capital and secured on a portfolio of bridging and development loans. The revolving credit facility will enable Kuflink to access capital so it can grow at scale and have an alternative source of debt finance. 

The size of the investment is subject to increase and has been arranged on a flexible three-year commitment which will be renewed annually. 

Narinder Khattoare (pictured), CEO of Kuflink, said the new facility would take the lender to the “next stage” of its growth plans. He also said it ensured certainty of funding for its introducers. 

He added: “This agreement is the culmination of a lot of hard work, not only from our team at Kuflink but especially at European Risk Capital and Paragon Bank and I would like to thank everyone involved for making it happen.” 

Jamie Pickering, director, structured lending at Paragon Bank, said: “Paragon is delighted to further our support for innovative specialist lenders by providing Kuflink with a bespoke, structured solution. With a strong management team and a positive focus on the UK housing market, Kuflink is ideally placed to achieve their growth plans.  

“I look forward to following Kuflink’s successful progress, and supporting the growth of other specialist lenders, in the years ahead.”  

Kuflink said its peer-to-peer lending platform had originated over £300m in gross loans to date and there had been no investor losses. Last month, the lender said it wanted to grow its loan book to £500m. 

Tony Gioulis, managing partner at European Risk Capital, added: “Against the current macroeconomic backdrop and challenging market conditions, the facility is a testament to Kuflink’s loan portfolio credit quality, robust underwriting criteria and, in particular, its resilience and track record, in conjunction with Paragon’s product skill and asset class expertise.  

“The transaction is consistent with European Risk Capital’s strategy of delivering transformative value to UK non-bank originator lenders in terms of committed growth capital and enabling them to access enhanced leverage at a competitive cost of funds, underpinned by our institutional investor base and its broad risk/return credit profile.”