January P2P Lending Platform News Round-up

Totals lent to date (16th January 2019)

*All data correct at the time this blog was compiled.

LOANS TO BUSINESSES

Assetz Capital - £699,500,000

Crowd2Fund - £25,600,000
Funding Circle - £4,200,000,000
FundingSecure - £296,241,109
Money & Co - £6 million approx
Rebuildingsociety - £13,200,000
ThinCats - £385,679,000
Invest and Fund - £3 million plus
LendingCrowd - £49,507,716
ArchOver - £88,278,000

PERSONAL P2P LENDING

RateSetter - £3,005,780,654

Lending Works - £148,202,611

…………..

LOANS TO BUSINESS

Assetz Capital

Lent to Date: £699,500,000 - £20.8 million growth (3.06%) since 12th December.

When this blog was compiled, there were 79 loans in the pipeline with 0 imminently due to be drawndown.

Highlighted Loan: Property Developers from Yorkshire requested the initial >£509 drawdown of a >£2 million facility to complete the construction of 12 homes. There was a first charge over the site which gave a LTV in the region of 65% and made the return of 7.5% pa seem reasonable. I was happy to invest.

Managed Accounts: The following accounts automatically distribute funds on behalf of investors across different sections of the platform's portfolio and are covered by a discretionary Provision Fund (the target rates of return are in brackets):

Quick Access Account (4.1% pa)

30 Day Access Account (5.1% pa)

Property Secured Investment Account (5.5% pa)

Great British Business Account version 2 (6.25% pa)

Platform News: The Assetz Group today launched their Assetz Exchange website which will allow investors to get directly involved with property development projects with profits made from rental income/sales. Its first offering concerns student flats in Leeds with have a projected return of 5.94% pa.

Crowd2Fund

Lent to Date: £25.6 million – latest available figure.

In since the last blog, I received 6 email notifications about new auctions launched on the site.

Highlighted Loan: High end cake makers returned to Crowd2Fund to raise a further £106k to fund an internet marketing campaign. Their pre-tax profits were more than double the amount being borrowed although obviously a downturn in fortunes could wipe that out. The loan was Director Guaranteed and, as is usual for this site, no details of their assets was provided. Given the risks involved, investors were offered a return of 12% pa.

Platform News: Crowd2Fund intend to ring in the changes during 2019. They plan to introduce a Provision Fund during the second quarter of the year. This is something investors will be able to opt into although they will have to accept a reduction in their rate of return as part of their income will be used to propagate the fund which will cover defaults.

The site also plans to allow investors to vote on whether bankruptcy proceedings should be instigated when borrowers are behind with their repayments.

Funding Circle

Lent to Date: £4.2 million

Funding Circle are unique amongst the major P2P platforms that lend to SMEs in not allowing investors to choose who they lend to. Instead two managed accounts are offered which distribute funds across differing risk profiles of loans within their portfolio. These options are projected to offer returns in the ranges of 5% - 5.5% pa and 6% - 7% pa.

As an active rather than passive investor, I am no longer involved with Funding Circle however posters on forums who remain with this site express concerns over the apparent lack of due diligence that is undertaken.

FundingSecure

Lent to Date: £296,241,109 at end of December – monthly growth of £4,891,450 (1.68%).

The site deliberately throttled back on the number of new loans listed during November and December as they have been struggling to keep on top of the high number of property developers that have been unable to meet their repayment deadlines – property loans are notoriously high maintenance.

Expect a change of strategy with new products being offered later in January.

Highlighted Loan: A £106k loan renewed just before Christmas with security provided via a workshop in Northern Ireland. It was expected that, once ongoing works are completed, longer term finance will be put in place. With a LTV below 50% and a return of 12% pa, I was tempted to invest but decided not to bother when I remembered the large number of loans I am exposed to from this part of the UK that are late.

Defaults: The remaining model trains have been sold at quite a significant loss further bringing into doubt FundingSecure's valuation procedures meanwhile the platform said goodbye to 2018 by sending me notification that they had formally set a couple of my loans to "unredeemed" and then 2 more were added to the list in the past few days. All are secured against properties that receivers are trying to sell.

Money & Co

Lent to Date: £6 million approx. (latest available figure)

When this blog was compiled there was 1 auction taking place which concerned a £250k loan to a German Property Developer. This was the sixteenth tranche of funding to this borrower who seems to have been the site's only customer since the Summer. Investors were offered a return of 8% pa although no financial information was provided.

rebuildingsociety

Lent to Date: £13,200,000.

There were 0 auctions taking place when this blog was compiled.

ThinCats

Lent to Date: £385,679,000.

There were 0 auctions taking place when this blog was compiled.

Platform News: During 2018, ThinCats lent £112 million to SMEs – setting a new record for this platform.

Invest & Fund

Lent to Date: Over £3 million

There were 0 auctions taking place when this blog was compiled.

Highlighted Loan: Property Developer in Cheshire returned for their ninth <£69k tranche of funding for a £1.885 million facility required to develop 6 four bedroom properties. The latest Monitoring Surveyor's report suggests that the project is on schedule to complete more or less on time next Summer. Investors were offered a return of 8% pa.

LendingCrowd

Lent to Date: £49,507,716 – increase of £1,676,280 (3.50%) since 12th December.

On the morning this blog was compiled, 2 auctions were waiting to be funded on the site.

Highlighted Loan: Consultants providing services in the Utilities sector requested £54.5k as they looked to hire more staff and make software & system changes to achieve their ambitions of developing a more efficient business. Turnover had trebled in the 12 months to last February with annual profits just about covering the capital being borrowed however the fact that the Financial Data was so old limited the amount I was willing to commit even though my bid earnt a return of just under 10% pa.

Platform News: LendingCrowd have introduced a new cashback offer to coincide with the New Year although it is not quite as generous as the promotion they offered last Autumn. The minimum threshold for receiving £100 is £2,500 instead of £2,000. The middle level of cashback (for those investing £5,000 to £9,999) has reduced by £50 to £200 while those allocating £10,000 and above to borrowers receive £400 rather than £500.

ArchOver

Lent to Date: £88,278,000.

There were 4 auctions taking place when this blog was compiled.

Highlighted Loan: Installers of passive fire prevention systems were looking for £300k to purchase specialist equipment and buy stock in order to furnish large contracts with Blue Chip companies (although the latter do not appear to be inplace). A return of 7% pa was offered and security was provided via a charge over future income with insurance provided by Coface.

PERSONAL P2P LENDING

Ratesetter

Lent to Date: £3,005,780,654 – an increase of £73,848,620 over the past 2 weeks – 2.52% growth.

Returns: Interest rates are set according to supply and demand. They currently range from 3.3% pa to 6.0% pa depending on the length of the investment. These figures have increased by 0.7% pa and 0.2% pa respectively.

Capital is covered by a Provision Fund. Ratesetter proudly boast that no investor has lost a penny since they launched in 2010.

Lending Works

Lent to Date: £143,193,260 – an increase of £5,009,351 since 12th December – 3.5% growth.

Returns: 5.0% pa and 6.5% pa via an IFISA or standard account for 3 and 5 year investments respectively.

As well as a Provision Fund to cover investor's risks, this site also insures borrowers against redundancy, fraud, illness and accidents making this a very fair site for all concerned.

****Disclaimer: This blog contains the views of the Secret Investor. Your capital is at risk when lending via all P2P Platforms. You're recommended to speak to a qualified Independent Financial Advisor.