£250m · Debt · Fintech · London, UK
London-based SME lender iwoca has closed a £250m debt facility with WAM Capital, part of Waterfall Asset Management, and an unnamed leading UK bank. The company says the structure will expand its capacity to fund small businesses across the UK and can grow as demand scales. The facility is lending capital for customer loans rather than a £250m equity investment in iwoca.
A funding line that grows with demand
iwoca offers business loans from £1,000 to £1m. Every loan it originates creates a receivable that must be funded, so access to institutional debt is part of the operating model rather than simply a source of cash for product development. The company says the new structure will let it support businesses investing in equipment, expanding operations or managing growth opportunities.
The timing reflects a shift in the applications iwoca sees. Its SME Expert Index found that loans between £50,000 and £100,000 represented 42% of applications in the first quarter of 2026, up from 27% a year earlier. A larger average request consumes funding capacity faster, even if application volumes remain steady. A facility designed to expand with demand gives iwoca more room to originate those loans without relying on an equity raise for each step-up in the book.
That mechanism also explains why the identity and structure of funding partners matter. An established private-credit manager and a bank can provide capital against a portfolio of SME receivables, while iwoca supplies origination, underwriting and servicing. The commercial benefit depends on converting the available line into performing loans at a funding cost that leaves enough margin after losses and operations.
Scale raises the underwriting test
iwoca says it issued 58,000 loans worth more than £1.3bn to UK businesses in 2025, increasing lending value by 60% year on year. It also says the number of UK SMEs funded since 2012 reached 96,000. Those figures show why another large facility is useful: growth in both ticket size and aggregate lending requires a broader funding base.
The company had already added debt from Lloyds, Citi, Barclays, Värde Partners, Pollen Street Capital and Insight Investment over the previous two years. Waterfall said iwoca had maintained strong credit performance while expanding its products, but that remains the central execution test. More capacity can increase originations; durable economics will depend on defaults, recoveries, funding costs and servicing performance as the loan book grows.
Investor Augmentum reported that iwoca generated £234m of revenue and £59m of profit before tax in 2024. Those historical figures indicate that the lender had reached meaningful operating scale before this facility. The £250m structure can extend that model, but its value will ultimately be measured by how much becomes well-performing SME credit rather than by the headline commitment alone.
