Peer-to-peer lending sites: MSE guide discussion

soulsaver

Psyduck1980 wrote: »

Does anyone know roughly how long it takes for an investment 1.5% above the so called "going rate" takes to get matched in the Access market?

As the volume available to lend far exceeds the borrower £££ demand, AIUI unless an investor sells out early there is no guarantee it'll ever be matched.

And while the imbalance remains it doesn't make commercial sense for a rolling market/access lender getting going rate+1.5% to close their position early.

Of course there maybe factors other than commercial.

Froggitt

Must read article in today's Sunday Times. Summary......provision funds are bombed out.

https://www.thetimes.co.uk/article/peer-to-peer-bosses-promised-to-cut-risk-now-theyre-about-to-cut-your-returns-5md3vsk2q

RateSetter’s provision fund, which is paid for by loan fees, has £9.9m left in it — but in 2018, the firm had to pay out £23m to investors who suffered losses, and it is projecting £27m in payouts to cover losses throughout 2019.

RateSetter said its provision fund had shielded customers from losses for the past nine years, but warned that investors should not see it as a guarantee for their investments.

A contingency plan, called a “haircut”, will kick in when the fund runs dry. This will see investors who have earned a return on their loans having their profits trimmed in order to refill the pot.

Zopa, the first major lender to launch in the UK, has just £1m left in its provision fund, which could be called on to repay up to £75m in outstanding loans. In 2018, it paid out £6.4m from the fund, and in 2017 it paid out £12.2m.

New loans issued through Zopa are not covered by the provision fund, which only applies to investments made before December 2017.

Zopa insisted it had “budgeted for future contributions” to the pot should bad debts exceed £1m.

Froggitt

Does anyone think these P2Ps have a future if they implement a haircut? Surely they become an "orderly runoff" if they lose investor confidence for new funds.

Zero_Sum

Froggitt wrote: »

Must read article in today's Sunday Times. Summary......provision funds are bombed out.

https://www.thetimes.co.uk/article/peer-to-peer-bosses-promised-to-cut-risk-now-theyre-about-to-cut-your-returns-5md3vsk2q

And I suspect thats the reason behind their rate reduction to try & build up the provision fund.

firestone

Froggitt wrote: »

Must read article in today's Sunday Times. Summary......provision funds are bombed out.

https://www.thetimes.co.uk/article/peer-to-peer-bosses-promised-to-cut-risk-now-theyre-about-to-cut-your-returns-5md3vsk2q

Always worth watching the monthly stats that RS post in their blog but it would be interesting to know the truth as the 4th way site said this week the RS fund is worth 36m

Zero_Sum

firestone wrote: »

Always worth watching the monthly stats that RS post in their blog but it would be interesting to know the truth as the 4th way site said this week the RS fund is worth 36m

Just had a look at their stats.

Its £9.9m in bank then a further £25.8m in year expected contributions to provision fund which gives you your £36m (well £35.7m rounded up)

They then expect to pay out £29m of that during the year.

firestone

Zero_Sum wrote: »

Just had a look at their stats.

Its £9.9m in bank then a further £25.8m in year expected contributions to provision fund which gives you your £36m (well £35.7m rounded up)

They then expect to pay out £29m of that during the year.

lets hope they don't need the rounding up:)

torrence

Has anyone got experience of these?
Funding Circle
Assetz Capital
Rate Setter

I have read that Funding Circle had to change its process for withdrawals late last year after lenders were facing long delays to withdraw money but that this has now started to improve. I haven't read anything that isn't positive about the Assetz Capital and RateSetter. Are these the most sound of the P2P market?

AdrianC

torrence wrote: »

Has anyone got experience of these?
Funding Circle
Assetz Capital
Rate Setter

I have read that Funding Circle had to change its process for withdrawals late last year after lenders were facing long delays to withdraw money but that this has now started to improve. I haven't read anything that isn't positive about the Assetz Capital and RateSetter. Are these the most sound of the P2P market?

I have experience of all three of them.

I took my money out of FC years ago when rates fell, then they went "black box" - but without any PF.
Assetz has been good, but there's not been much in the way of worthwhile new loans for ages.
RS has been good, lower rates and black-box, but with PF. Their rates have dipped in recent times, though, and I haven't bothered figuring out their recent changes.

RS is the only one of the three I still have accessible money in, and that's coming out as it repays.

ukinvestor99

Thinking of investing? Don't! Uown sister company (Broadley) just went down owing £15 million to the supply chain. Very risky. Yes they say capital is at risk, trust me they mean it.

Google Broadley group and see what comes up!