CrowdLending (Business) - Germany

Germany is expected to see the total transaction value in the Crowdlending (Business) market market reach US$139.00m by 2025.
When comparing globally, it is evident that China is projected to reach the highest transaction value, amounting to US$17bn in 2025.
Germany's CrowdLending market for Capital Raising is seeing a surge in investor interest, reflecting the country's strong economy and tech-savvy population.

Definition:

Crowdlending platforms, otherwise know as lending-based Crowdfunding enable small and medium-sized enterprises to get loans from single or multiple, private and institutional investors via an online brokering platform. On credit platforms such as Funding Circle, OnDeck, Kabbage and Lending Club, businesses can obtain small loans up to a set maximum value. As a rule, financing requests are analyzed by the provider via an internal scoring system and are checked against additional minimum requirements such as turnover. Subsequently, these financing requests can be invested in by private and institutional investors at an appropriate interest rate determined by the credit rating of the company. This makes it possible for SMEs to borrow quickly and easily, as the basic requirements for obtaining finance are more flexible compared to traditional bank loans.

Alternative financing for SMEs and freelancers (bank-independent loans)
Small business loans issued by single or multiple private and institutional investors (non-banks)
Online loan request, scoring and approval

Traditional bank loans
Consumer loans and credit card transactions
Business-to-Business credit scoring and rating services
Online marketplaces for consumer loans (see Marketplace Lending)

Digital Capital Raising: market data & analysis

The CrowdLending market within the Digital Capital Raising sector in Germany is witnessing mild growth, influenced by factors such as regulatory developments, increased investor interest, and the need for alternative funding sources amid traditional financing challenges.

Customer preferences: Investors in Germany are increasingly favoring CrowdLending platforms as a viable alternative to traditional financing methods, reflecting a cultural shift towards democratized investment opportunities. The growing interest is particularly evident among younger demographics seeking innovative ways to support small businesses. Additionally, the rise of sustainability-conscious investors is driving demand for projects that align with eco-friendly practices. This trend highlights a broader societal movement towards responsible investment, influenced by changing consumer values and lifestyle choices.

Trends in the market: In Germany, the CrowdLending market is experiencing a significant uptick as entrepreneurs increasingly turn to these platforms for financing, driven by a desire for faster, more flexible funding options. This trend is particularly prominent among tech-savvy millennials and Gen Z investors, who value transparency and direct engagement with businesses. Additionally, there is a noticeable shift towards sustainable investment opportunities, with platforms catering to eco-friendly projects gaining popularity. This evolution not only democratizes access to capital but also encourages greater corporate responsibility, ultimately reshaping the landscape for traditional financial institutions and investors alike.

Local special circumstances: In Germany, the CrowdLending market is thriving, fueled by a strong entrepreneurial spirit and a robust technological infrastructure. The country's well-established regulatory framework fosters trust and security among investors, differentiating it from less regulated markets. Additionally, Germany's cultural emphasis on sustainability has led to a surge in eco-conscious projects seeking financing, appealing to socially responsible investors. This unique blend of regulatory support and cultural values not only enhances investor confidence but also attracts diverse funding sources, reshaping the capital raising landscape.

Underlying macroeconomic factors: The CrowdLending market in Germany is significantly influenced by macroeconomic factors, including a stable national economy, low unemployment rates, and increasing consumer confidence. These conditions encourage entrepreneurial ventures that seek alternative funding sources. The European Central Bank's accommodative monetary policy, characterized by low interest rates, makes traditional financing less attractive, thus pushing businesses towards crowd-based funding solutions. Furthermore, the global shift towards sustainable investing aligns with Germany's cultural values, fostering a favorable environment for eco-friendly projects. This confluence of economic stability and progressive investment trends is reshaping the digital capital raising landscape.

Data coverage:

The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Finance market, in a PDF format.

Crowdfunding is the collective effort of a large number of individuals who network and pool small amounts of capital to finance a new or existing business venture. Each campaign is set for a goal amount of money and a fixed timeframe, each day is counted down and the money raised will be tallied up for visitors to follow its success. The size of the global crowdfunding market is growing and the largest markets are North America and Asia.

CrowdLending (Business) - Germany

Capital Raised

Key Players

Average Deal Size

Global Comparison

Number of Deals

Analyst Opinion

Methodology

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