May's P2P Lending Platform News Round-up

Totals lent to date (2nd May 2018)

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

LOANS TO BUSINESSES

Assetz Capital - £509,100,000

Crowd2Fund - £17,120,000
Funding Circle - £3,400,000,000
FundingKnight - £31,485,000
FundingSecure - £235,735,508
Money & Co - £6 million approx
Rebuildingsociety - £12,400,000
ThinCats - £285,889,000
Invest and Fund - £3 million plus
LendingCrowd - £32,051,756
ArchOver - £66,176,000

PERSONAL P2P LENDING

Zopa - £3,250,000,000
RateSetter - £2,457,314,112

Lending Works - £104,621,554

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LOANS TO BUSINESS

Assetz Capital

Lent to Date: £509,100,000 - £20.5 million growth (4.2%) in the past fortnight.

When this blog was compiled there were 65 loans in the pipeline with 2 of these imminently due to be drawndown.

Highlighted Loan: Borrower from the Midlands required the initial <£214k tranche of a £3.2 million facility to construct an apartment block containing 40 units plus a retail space on the site of a former City Centre pub. It seemed to be in a good location and the LTV was circa 65% therefore I invested a large sum for a return of 8% pa with a view to selling after 6 months.

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 (3.75% pa)

30 Day Access Account (4.25% pa)

Property Secured Investment Account (5.5% pa)

Great British Business Account version 2 (6.25% pa)

Green Energy Income Account (7% pa) – New capital coming into this account have been paused due to the lack of available loans meeting the investment criteria.

Crowd2Fund

Lent to Date: £17.12 million – figure not updated in the past fortnight.

Over the past 2 weeks, 3 auctions were listed on the site.

Highlighted Loan: A company involved within the realm of foreign exchange returned to Crowd2Fund for their second capital injection from this platform. On this occasion they were looking to raise £150k to expand their sales team and launch a marketing campaign. Their annual profits were slightly below the loan amount but net assets were a seven figure sum however the drawback against this site is the lack of detail with regards to the security held thus there is no guarantee that a charge is held against all of those assets.

Funding Circle

Lent to Date: £3,400,000,000

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 return 4.8% pa and 7.2% pa.

As an active rather than passive investor, I am no longer involved with this site.

FundingKnight

Lent to Date: £31,485,000 – no change.

There were 0 auctions ongoing when this blog was compiled – only 1 loan appeared on this site during 2017. The platform is planning a relaunch at some point in 2018 but there have been no signs of life so far.

FundingSecure

Lent to Date: £235,735,508 at end of March – total updated monthly.

Today 1 auction was launched on the site.

Highlighted Loan: I invested a large sum in a renewal last week. The loan was secured by a second charge over a substantial property where the borrower intended to sell part of the grounds for development. Planning permission has now been granted for 2 x 4 bedroom houses and contracts have been exchanged with a developer. I had been waiting for a few weeks to allocate a lump sum from the sale of another loan on this platform – all the best ones tended to have 3-figure maximum bids – so I was pleased to get my funds out there and earning interest via this deal.

Defaults: No new defaults and a few properties held as security against some of my bad loans appear close to being refinanced.

Money & Co

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

When this blog was compiled there were 2 auctions taking place.

Highlighted Loan: A chain of 12 hair salons required £200k to enable 3 of its weakest outlets to be closed. I think this is the first time I have seen a P2P borrower require funds for contraction rather than expansion furthermore their annual profits were only 10% of the capital being raised as was the forecasted net assets for 2018. I couldn't see how this loan was ever going to be repaid! For brave investors, a return of 9% pa was offered.

rebuildingsociety

Lent to Date: £12,400,000 – most recent figure.

There was 1 auction taking place when this blog was compiled.

Highlighted Loan: Providers of training to fitness instructors and P.E. Teachers were looking to raise £27k to facilitate the opening of a new campus. The financials looked very good and the only issue was a lack of security which amounted to a Personal Guarantee for slightly less than the loan amount. On the strength of the business, I invested the £20 that had been repaid by another borrower for a return of 15% pa.

ThinCats

Lent to Date: £285,889,000 – fortnightly increase of £6,165,000 – 2.2% growth.

There were 3 auctions taking place when this blog was compiled.

Highlighted Loan: Jewellers on the south coast required £215k to fit-out their fourth outlet. This loan ranks behind a £950k capital injection that was taken out via ThinCats last August against security in the shape of the business' stock, albeit this has a guaranteed buy-back from the manufacturers to avoid cheap items becoming available to the public and has a value of £2.3 million. Investors were offered a return of 9% pa.

Invest & Fund

Lent to Date: Over £3 million

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

Highlighted Loan: The developer who is converting a former brewery into 6 apartments required his fourth tranche of funding. This was for <£97k of the £575k total. Work remains on schedule and investors were offered a return of 9% pa.

LendingCrowd

Lent to Date: £32,051,756 – fortnightly increase of £1,798,240 – 5.94% growth.

1 auction took place on the day this blog was compiled.

Highlighted Loan: A marquee hire business required £27k to buy a bigger tent which they expected will increase their margins. The financials looked good and an asset was being purchased therefore it was no surprise to see the loan was 20% over-funded in no time with investors picking up an average return of 9.5% pa.

Platform News: LendingCrowd are reducing their maximum bid rates for each risk band by 2% pa from tomorrow. They say investors have been complaining about getting outbid (although anyone who has that problem should bid at a lower rate!) but the more likely reason is that borrowers have ended up with a higher cost of borrowing than they expect. Certainly, with the range of bid amounts being so wide, it must have been something of a lottery for borrowers although the change is likely to reduce returns for savvy investors.

ArchOver

Lent to Date: £66,176,000 – fortnightly increase of £3,712,000 – 5.94% growth.

There were 2 auctions taking place when this blog was compiled.

Highlighted Loan: A familiar borrower in the shape of a company that supports SMEs by providing extended credit terms returned to renew £200k lent from this site a year ago. To date they have borrowed £13.72m from ArchOver's investors and repaid £8.97m of capital. The latest tranche of funding was going to be used to support a business that provides energy saving equipment to major facility management companies. Security was provided by a charge over Bills of Exchange and the loan was insured by Coface therefore the return was low compared to other platforms at 6.75% pa.

PERSONAL P2P LENDING

Zopa

Lent to Date:  £3.25 billion – an increase of £40 million over the past 2 weeks – 1.25% growth.

Returns: Zopa's 2 accounts offer returns of 4.0% and 4.6% pa with the latter allocating some funds to riskier loans that offer higher returns.

Zopa distribute investor's money mostly to unsecured consumer loans.

Platform News: Since their IFISA launched last year, Zopa has seen £100 million invested via this tax-free wrapper in the form of new investments alone (excluding funds transferred from the platform's other accounts). To celebrate, Zopa are offering a sliding scale of Cashback on investments coming into the platform from new or existing customers until 8th May. This will see those who deposit £20k or more earn £200 while £50 is offered to those who lend £5,000 to £9,999.99, £100 for £10,000 to £14,999.99 and £150 for £15,000 to £19,999.99.

Ratesetter

Lent to Date: £2,457,314,112 – an increase of £24,396,537 over the past 2 weeks – 1% growth.

Returns: Interest rates are set according to supply and demand. They currently range from 2.7% pa to 5.0% pa depending on the length of the investment. These numbers are little changed from a couple of weeks ago.

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

Platform News: Having made their IFISA available only to existing customers in February before opening up to new customers in March, Ratesetter are now allowing the transfer of funds from existing Cash ISAs, Stocks & Shares ISAs and other IFISAs.

Lending Works

Lent to Date: £104,621,554 – an increase of £2,617,695 over the past 2 weeks – 2.57% growth.

Lending Works have passed the £100 million lent mark.

Returns: 4.5% pa and 6.0% pa via an IFISA or standard account for 3 and 5 year investments respectively. These have not changed over the past month.

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.