Peer-to-peer lending sites: MSE guide discussion

fun4everyone

takesyourchances wrote: »

My P2P money is spread on several platforms, but I have a good shuck in Collateral. They did come across as professional to me and were highly thought of at one stage on the P2P forum.

This is identical to me, glad I am not the only one who considered them professional before this.

Worse case, I will just write it off what else can we do, hopefully does not reach that stage.

From what I understand they had to have in place a procedure for if this happens (if it is just platform going bust). That includes having someone take over the management of the loans for us. We might lose access to our funds for quite a while if that's whats going to happen but should be ok long run....

Of course if there was a fraud and money has gone missing. Be it from cash in the client accounts, loans that were not drawn down or loans that were misrepresented on the site with the money going elsewhere then god knows. Probably hoping for criminal action and waving bye bye money.

I understand they did not have full FCA authorisation yet, whatever that means for this potential situation.

fun4everyone

A poster on the p2p forum (not me) just posted this

The cached terms and conditions on Google suggest

"•In particular you should note that if Collateral was to become insolvent then any money held by it would not be held in accordance with the FCA’s client money rules, which require in particular that client money is held separately from a firm’s own money, and it is likely you would rank as an ordinary unsecured creditor. Ordinary unsecured creditors rarely make any recovery on insolvency."

I did have a little cash on the account there plus some loans that were not drawn down yet :mad:

takesyourchances

fun4everyone wrote: »

This is identical to me, glad I am not the only one who considered them professional before this.



From what I understand they had to have in place a procedure for if this happens (if it is just platform going bust). That includes having someone take over the management of the loans for us. We might lose access to our funds for quite a while if that's whats going to happen but should be ok long run....

Of course if there was a fraud and money has gone missing. Be it from cash in the client accounts, loans that were not drawn down or loans that were misrepresented on the site with the money going elsewhere then god knows. Probably hoping for criminal action and waving bye bye money.

I understand they did not have full FCA authorisation yet, whatever that means for this potential situation.

Yes, I though the same when I decided to invest with them and others did too on that forum. What a difference a year makes.

If they have gone bust and someone is to take over the loans that would not be so bad even if it took a long time, worse case is losing the lot so anything back would be good if this happened. Hopefully it is nothing sinister and if it is a genuine case not informing people was a huge mistake and they would need to learn from this. Anyone these days can reach internet with phones etc, even if just a social media post.

I was already starting to change directions away from the property loans to unbolted and likes of lending works and was more active with my S&S ISA again which I will continue with. Tomorrow will be interesting if no solid news

economic

Let this be a lesson. I suggest re-reading what i have been saying. Do not think this can not happen to the likes of assetz, lending works, zopa, unbolted, funding circle, lendy etc etc.

takesyourchances

economic wrote: »

Let this be a lesson. I suggest re-reading what i have been saying. Do not think this can not happen to the likes of assetz, lending works, zopa, unbolted, funding circle, lendy etc etc.

To be fair you have been raising warnings for a while with P2P and de-risking yours down. I didn't like the large property route, slowed money going in down and changed to other loans, but was not looking at a total wind down. .

The collateral situation regardless of the reason and outcome is a bit of a wake up to platform risk too.

With stockmarket swings and crashes at least in time there is a good chance of recovery and growth which is easier in my opinion to deal with than platforms going under. I have enough in P2P overall, but mostly stock market and close to reaching a milestone amount for me invested so I am also putting in to reach that, so maybe I should go heavier this direction.

TheShape

I have been very bullish about p2p with a significant amount of my money in p2p platforms, Collateral being the largest holding.

Discussion here in recent days (re p2p and recessions) had led me to reassess my position and I'd been taking small steps to reduce my p2p investments. The first I noticed of the situation with Collateral was when I attempted to log in last night to make a small withdrawal and found the site down/missing.

I hope that the situation is not as bad as it appears. If it is, I will have learned a very costly lesson.

economic

I have withdrawn nearly everything from FC.
I have 1k in lendy which will probably take years to recover.
I am selling down assetz, still someway to go.
LW and RS i will just withdraw repayments as selling prematurely incurs a fee and these two platforms seem to be decent anyway so dont mind it being slow.
ABL rate i will let mature as i like the risk/return.
Collat and MT i have tiny amounts left, just waiting to get back.

takesyourchances

TheShape wrote: »

I have been very bullish about p2p with a significant amount of my money in p2p platforms, Collateral being the largest holding.

Discussion here in recent days (re p2p and recessions) had led me to reassess my position and I'd been taking small steps to reduce my p2p investments. The first I noticed of the situation with Collateral was when I attempted to log in last night to make a small withdrawal and found the site down/missing.

I hope that the situation is not as bad as it appears. If it is, I will have learned a very costly lesson.

I only found out about Collateral tonight after seeing more loans in default at moneything and posting that here. I was bullish myself with P2P mostly last years pace, I have still be adding but not at the same pace. There has been a lot of valid points raised recently which was making me think too, but I admit was still investing in other platforms even if lower than last years pace.

Hopefully the situation with Collateral is not as bad as it appears, likewise it will be a very costly lesson to me too if it turns sour and waiting on the outcome of MT defaults, I would be licking my wounds.

My S&S seems way more simple tonight.

keyboardworrier

If this is a simple case of Collateral going bust then I am not too concerned about the situation, as mentioned above the FCA requires all platforms to have procedures in place for that eventuality.

I am reconsidering my position on P2P as a whole though, I've earned a lot in interest and might get out whilst the going is (reasonably!) good.

fun4everyone

Sadly collateral's t&c is saying they can help themselves to client accounts in the case of insolvency and they are not following the usual FCA rules.

They didn't have full FCA authorisation.

I have a lot in collateral and hoping everything is ok. Can copy the relevant quotes from p2p forum in a sec