GoCardless & Pipe partner to offer finance to UK SMEs

GoCardless, a UK bank payment company, has partnered with US fintech firm Pipe to launch embedded finance solutions tailored for small to medium-sized enterprises (SMEs) in the UK.

This collaboration follows a successful pilot programme throughout the year, marking Pipe's entry into the UK market to provide businesses with the capital they require efficiently. The partnership integrates Pipe's capital offerings directly into the daily applications used by SMEs, thus simplifying the process of obtaining funding.

"Our partnership with GoCardless in the UK market marks a significant step forward in our mission to empower small businesses worldwide with the financing and services they need to grow and prosper," said Luke Voiles, CEO of Pipe. "By combining Pipe's customer-friendly solution with GoCardless's extensive reach in the UK market, we're revolutionizing how small businesses access capital and providing them with the financial tools they need to thrive in today's dynamic economy."

This endeavour comes after Pipe's launch of its embedded capital solution in the US earlier in May. GoCardless opted to partner with Pipe due to its high pre-approval rates for merchants and its capital offerings that require no personal guarantees or credit checks. The system offers flexible top-ups similar to a line of credit and provides a streamlined user experience, benefiting micro and minority-owned businesses that often lack the traditional credit scores required by legacy lenders.

In the UK, SMEs often face diverse financing needs, from expanding their businesses to managing cash flow issues caused by late payments, which affect 52% of businesses. A significant portion, about one in six, are actively seeking financing solutions.

Pipe's embedded finance approach enables businesses to secure capital in a matter of minutes based on business performance rather than undergoing the conventional lengthy underwriting process, with pre-approval rates exceeding ninety percent.

Sam Brooksworth, Founder and CEO of Remoteli, described his positive experience with Pipe via the GoCardless platform: "I was thrilled to receive an offer from Pipe through the GoCardless platform because GoCardless is a brand we trust." Sam further stated, "Everyone needs a financial partner in their corner to take your business to another level, and that's what Pipe feels like. Rather than feeling like you're owing somebody, Pipe makes you feel like it's a partnership."

Initial outcomes from the pilot programme have been promising, with Pipe achieving engagement levels twice as high as industry benchmarks. The comprehensive product roll-out is anticipated in 2025.

Jolawn Victor, Chief Growth Officer at GoCardless, remarked, "We're excited to work with Pipe to roll out their capital offering to our UK customer base. Their expertise and support helped us implement a pilot program quickly. Early results have exceeded expectations with almost GBP £7m in capital being advanced to GoCardless customers. Customer feedback has been overwhelmingly positive, with the program achieving an impressive 88 Net Promoter Score. The strong conversion rates from the pilot show there is pent-up demand for this type of financing. We look forward to fully launching this embedded product next year, helping customers tap into new opportunities for growth and expansion while continuing to build their trust and loyalty in GoCardless."