CrowdLending (Business) - Ukraine

The total transaction value in the Crowdlending (Business) market market in Ukraine is expected to reach US$3.17m in 2024.
When compared globally, it is evident that China leads with a transaction value of US$16bn in 2024.
Ukraine's CrowdLending market is gaining momentum as more businesses turn to alternative capital raising methods for growth opportunities.

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)

The CrowdLending (Business) market in Ukraine has been experiencing significant growth in recent years, driven by various factors such as customer preferences, trends in the market, local special circumstances, and underlying macroeconomic factors. Customer preferences in the CrowdLending (Business) market in Ukraine have been shifting towards alternative financing options, such as peer-to-peer lending, due to the ease and convenience it offers.

Small and medium-sized enterprises (SMEs) in Ukraine are increasingly turning to CrowdLending platforms as a way to access funding quickly and bypass traditional banking institutions. This preference for alternative financing options is also driven by the increasing number of tech-savvy entrepreneurs in Ukraine who are more open to using digital platforms for their financial needs. Trends in the market indicate that the CrowdLending (Business) market in Ukraine is becoming more competitive, with new players entering the market and existing platforms expanding their services.

This increased competition has led to lower interest rates and more favorable terms for borrowers, making CrowdLending a more attractive option for businesses in need of financing. Additionally, there is a growing trend of specialized CrowdLending platforms catering to specific industries or sectors, providing tailored financing solutions for businesses in niche markets. Local special circumstances in Ukraine, such as the limited availability of traditional bank loans for SMEs, have contributed to the growth of the CrowdLending (Business) market.

Many small businesses in Ukraine struggle to access financing from banks due to stringent requirements and high interest rates. CrowdLending platforms offer a more accessible and flexible alternative, allowing businesses to secure financing based on their individual needs and creditworthiness. Underlying macroeconomic factors, such as the overall economic growth and stability in Ukraine, have also played a role in the development of the CrowdLending (Business) market.

As the Ukrainian economy continues to recover from the economic downturn and political instability, businesses are looking for reliable and efficient financing options to support their growth and expansion plans. CrowdLending platforms provide a viable solution for businesses in need of capital, contributing to the overall development of the market. In conclusion, the CrowdLending (Business) market in Ukraine is experiencing significant growth due to customer preferences for alternative financing options, trends in the market such as increased competition and specialization, local special circumstances that limit access to traditional bank loans, and underlying macroeconomic factors that support the development of the market.

As the market continues to evolve, it is expected to play an increasingly important role in the financing landscape for businesses in Ukraine.

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 Financial 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.