Current state of Peer to Peer accounts?

TUVOK

Could experienced investors in Peer to Peer lending accounts give me their views on how they see this sector currently, and for the future.
I hold approximately £6.3K in Zopa and £5.4K in Ratesetter, having opened both accounts in August 2015, I calculate that the profit on these accounts is 7.77% and 6.50% respectively.
I must hold my hands up and say that I have been a totally passive investor in both, just adding money roughly each month. Most of my limited time being given to my stocks and shares portfolios.
I have read recently on this excellent forum, some concerns about Ratesetter, and have realised that I should examine where I am exactly with these accounts and are they still a worthwhile and fairly safe investment, or is it time to run them down and exit.
Thanks in advance for any/all replies.

Alexland

I doubt they were ever a 'fairly safe' investment. Without knowing your exact contribution pattern it's hard to comment on the return but it doesn't sound great given you have taken material capital risk during the period. I only invested in P2P when the signup bonuses made it worthwhile but am now completely out.

itwasntme001

I started "investing" in P2P in 2016 but made a decision to exit out of nearly all the platforms over a year ago. Have run down nearly all my initial exposure. Whilst i made ok returns, i am confident that its not nearly enough to compensate me for all the risks: platform failure, economy turning down, bad underwriting, illiquidity etc. Indeed all these risks have shown up to some extent in many of the platforms, certainly nearly all the ones i had invested in.

Albermarle

I still have 4 P2P accounts ( does not include Zopa or Ratesetter) , mainly to just follow the general investment advice about diversification .
However it only accounts for <10% of my non pension investments and only 3% if you take pensions into account.
So far no major problems and I have an average return around 6%, most of which is tax free in IFISA's
I avoided the more 'wild west ' part of P2P. offering returns of 12 to 20% , which in the early days was very lucrative for early investors but has now largely imploded, or probably about to.
My worry is what would happen in a bad recession and due to this I have not added any new funds for a while. and have been with drawing the interest rather than re investing it.

SonOf

nd are they still a worthwhile and fairly safe investment

They have never been considered fairly safe.
P2P has been referred to as the Wild West and until the FCA regulate it properly and we have been through a significant recession, you don't really know what the outcomes will be.

Flobberchops

I've recently had deposits mature with RateSetter and Kuflink (both opened for referral bonuses) which went fine.

I was invested in both Collateral and Lendy, which have gone down in flames.

MoneyThing has been absolutely beset with non-performing and defaulted loans in the last year or so, and the new "lower risk, lower yield" loan offerings they floated were met with a wall of investor skepticism and/or apathy. Very disappointed with the performance of this platform.

I have a small holding in Rebuilding Society, which is a cheerfully high-risk platform and I went in fully aware this was not just the Wild West but in fact Happy Hour at the Last Chance Saloon. Plenty of defaults but I've been pleasantly surprised by the number of loans that have come good; overall I'm ahead on this platform. That's still not really a recommendation, though.

I'm very pleased with the continued good performance of Ablrate, although of course nothing is guaranteed.

If I could turn back the clock, I probably would have given P2P a wide berth and stuck to S&S instead, to be honest. Still, you live and learn. I could have bet the house on Crypto...

There is a very good specialist forum called the Independent P2P Forum. I strongly suggest you take a leisurely browse to get a feeling of the prevailing investor sentiment (spoiler: it ain't pretty.)

masonic

You won't be able to achieve those sort of rates on the accounts in question moving forward and the rates available aren't sufficient to compensate for the risk IMHO.

TUVOK

Thanks for all replies, they have re-inforced my view that perhaps it is time to start withdrawing funds as they mature.
I believe that in Zopa and Ratesetter I have two of the strongest funds, but perhaps with possible storms on the horizon its time to wind up my accounts.