Eight law firms have borrowed over £500,000 through commercial peer-to-peer lending, an innovative form of financing which some experts predict could one day replace banks.

Lender Funding Circle says it has lent a total of £500,000 to eight legal practices: three from the north-west, one from the north-east and the rest from the south-east. Two more peer-to-peer lenders are planning to enter the legal market.