May 26, 2015 Philip Burgess
The United Kingdom and Europe were immediately engaged in alternative financial services when the market first began to take shape not so long ago, and it appears as though these options are thriving today. When the global economy rose to prominence thanks to new technologies and innovation in communication mediums, there was plenty of hope that it would help to boost certain first world-nations stock higher, including those in Europe.
When the recession took place, though, it became clear that the global economy can also magnify financial challenges of a few and make them more pressing to a wider range of regions. Europe continues to reel from this, with several nations falling into default and needing bailout, experiencing the public outrage that comes with this particular territory, and impacts the U.K. and other nations as a result.
While some of the worst impacts appear to be behind the private sector, the use of alternative financial services has not slowed even slightly as a result, but has appeared to intensify by way of adoption and demand. Now, leveraging alternative financial services is beginning look more like a requirement for businesses and consumers in the U.K. and abroad to overcome some of the lingering problems that arose during the recession, and even progressing beyond performances that were experienced before the financial downturn took place.
Big in Europe
The Financial recently reported that a new study from the Judge Business School at the University of Cambridge alongside Ernst and Young revealed that Europe's alternative financial services market has grown by as much as 144 percent in 2014 alone. Interestingly, while the market is still maturing in the United States, Britain and Europe appear to be beyond these initial stages and already moving toward more common utilization.
According to the news provider, some nations that were studied in the report are beginning to see their alternative financial services markets enter into the mainstream, which is saying a lot given the objective novelty of these solutions. After all, alternative credit scoring and lending were simply not as prevalent or useful only a couple of decades ago, yet they have experienced a proverbial explosion in terms of demand more recently.
"These new forms of alternative finance are growing quickly, and this growth is beginning to attract institutional investors," Robert Wardrop, University of Cambridge's Centre for Excellence for Alternative Finance executive director, told The Financial . "Alternative finance, at least in some European countries, is on the cusp of becoming mainstream."
Finally, the source noted that Estonia and Sweden had the fastest rates of growth for alternative financial services demand among all nations involved, and that the global market has expanded at a rate of 75 percent through the past three years. Additionally, The Financial added that the U.K. is still home to the most thriving alternative financial services market in the region, with the next two closest countries having a fraction of its share combined.
A look ahead
In the coming years, many economists believe that the financial climate will remain resilient and continue to improve, but that challenges and obstacles will certainly arise as this is simply part of the recovery process. Whether a business is facing situations in which gravity is maximized or simply looking to get their loans and credit scores from new players in the market, alternative financial services will continue to be a major source of support for all involved.
By opening the doors to a wider range of options, enterprises might be able to get better deals on the necessary financial services they seek.