P2P Lending Platform News Round-up (25th August)

Totals lent to date (25th August 2016)

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

LOANS TO BUSINESSES

Assetz Capital – £130,861,275
Funding Circle - £1,437,953,560
FundingKnight - £31,105,000
FundingSecure - £53,186,818
Money & Co –  £6 million approx
Rebuildingsociety – £10,378,581
ThinCats - £188,502,000
Invest and Fund - £1 million plus
LendingCrowd - £4.5 million
ArchOver - £20,277,000

PERSONAL P2P LENDING

Zopa - £1,420,000,000
RateSetter - £1,372,997,820

Lending Works - £32,797,618

…………..

LOANS TO BUSINESS

Assetz Capital  

Lent to Date: £130,861,275 – fortnightly increase of £1,180,000 – 0.91% growth.

When this blog was compiled, there were 55 upcoming loans with 2 imminently due for drawdown.

Highlighted Loan: Most loans on the Assetz Capital platform are straight forward business transactions however one that is shortly to be drawn-down is going to be used by the borrower to settle his wife's bankruptcy. The reason she got into financial trouble was due to a phobia of brown envelopes which caused her to get behind with her HMRC commitments to the tune of c£175k. She also has a small CCJ from unpaid building work. The total loan is for £270k.

The headline figures say that the loan will be secured against a property valued at £2.3m however this is misleading because the LTV is over 60%. The reason for the discrepancy is due to the borrower's mortgage provider having first charge on more than £1m of the property's value.

The borrower and his wife are journalists/authors. They currently have significant income which will easily cover the interest repayments until the loan can be refinanced once their financial affairs have been resolved. Writing however is not the securest of professions.

Assetz Capital are usually one of the most careful and cautious of all the P2P sites but this loan certainly got my alarm bells ringing and, at less than 10% pa, the return for investors is not that great.

Managed Accounts: The following accounts automatically distribute funds on behalf of investors across the platform's loans and are covered by a Provision Fund:

Quick Access Account (3.75% pa return); 30 Day Access Account (4.25% pa return); Great British Business and Green Energy Income Accounts (both of these offer a return of 7% pa)

Platform News: Assetz Capital are celebrating being awarded a 5-Star rating by independent financial researchers, Defaqto. Not sure if they were aware of the loan to bail out a bankrupt wife…

Funding Circle

Lent to Date: £1,437,953,560 – fortnightly increase of £29,497,880 – 2.09% growth.

The fortnightly average of £29.5 million is the highest since March.

There were 11 auctions ongoing when this blog was compiled.

Secret Investor's Activity: This remains the site which I have the most exposure to because they have the largest number of loans listed.

Below are highlights from my activity in the past fortnight:

Highlighted Loan Invested in:

Expansion Loan of £122k to international training company (C risk rating, 11.9% pa return). This is the second loan to the borrower. The first loan was to set up a leased office in Singapore, this one is to purchase premises in that location so, unless the business is over-reaching itself, things seem to be heading in the correct direction.

Highlighted Rejected Loan:

Expansion Loan of <£32k to children's activity franchise (C risk rating, 11.9% return): The loan was to fund the purchase of an indefinite franchise for the UK and Ireland but it was not a brand I had ever heard of, I didn't find the product that appealing and, until recently, it was a loss making business with a poor credit rating.

Defaulted Loans Update: No defaults in the past fortnight although one of my borrowers has informed FundingCircle that they have ceased trading. They only owe me £13 however.

FundingKnight

Lent to Date: £31,105,000 – no loans completed in the past fortnight.

There were 0 auctions ongoing when this blog was compiled.

FundingSecure

Lent to Date: £53,186,818 at the end of July. Monthly growth of £3,627,600 (7.32%).

Total updated monthly.

There were 8 auctions ongoing when this blog was compiled.

Highlighted Loan: Bridging loan of £445k for the refurbishment of property with a view to selling on completion. This is a stand-out loan for the site at the moment as, while offering the standard return for FundingSecure of 12% pa, it offers a little more security than is typical for the site as in addition to a first charge on the property with a LTV of 64% the borrower has offered a personal guarantee.

Defaults: My two unredeemed loans remain in limbo with no progress in the past fortnight. Still waiting for the funds from the sale of the carpets to arrive while the saga of the Scottish boatyard continues.

Money & Co

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

When this blog was compiled there were 0 auction taking place.

rebuildingsociety

Lent to Date: £10,378,581 – no loans completed in the past fortnight.

There were 2 active auctions when this blog was compiled.

Highlighted Loan: Design company is looking raise £50k of marketing budget. This was to be mostly spent on increasing their web presence rather than being spent on saleable assets. The target market for growth is London which is already full of design agencies. While the business is profitable and returns to investors are going to be in the high teens, I decided to give this a miss. 

ThinCats

Lent to Date: £188,502,000 – fortnightly increase of £2,114,000 – 1.13% growth.

There were 5 active auctions when this blog was compiled with a couple more due to begin tomorrow (26th August).

Highlighted Loan: Property developer was looking to raise £450k to complete the redevelopment of a former office block into supported living accommodation and student flats. The borrower has raised capital via ThinCats previously and paid it back on time. The work is expected to be completed in 3 months but the loan is for 9 months to allow time for refinancing or sales to take place. Neither capital or interest will be paid until the end of the term. Reflecting this, the rate of return is a healthy 14% pa.

Platform News: ThinCats have introduced a grading system to help investors to assess the risk of loans. The system provides two ratings that can have a value of 1 to 5. These relate to Credit Quality and Security Quality.

Anti-Social Behaviour: The first of ThinCats' Social Loans failed to be fully funded. It offered a return of 0% and relied on investors claiming back 5% pa tax relief to gain a benefit. The platform is reviewing how these loans will be handled in future.

Invest & Fund

Lent to Date: Over £1 million

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

LendingCrowd

Lent to Date: Over £4.5 million as of the end of January.

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

Highlighted Loan: Financial advisors who also incorporate photographic services within their operations were looking to raise £25K to set up a photographic studio. The two aspects of the borrower's business seemed to have little in common and I wondered whether they were just looking to fund their hobby.

ArchOver

Lent to Date: £20,277,000 – no change in the past fortnight although, as loans have completed, this figure may not have been updated.

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

Highlighted Loan: Occupational Health providers returned to ArchOver to reborrow the £500k they raised via the site 6 months ago. They offered an interest rate to investors of 7% pa. In addition to security via a first, floating charge on the company's Accounts Receivable, the loan is also insured. The value of the Account Receivable is currently close to £4 million. While a bank has first charge of £200k over the assets of the business, this loan will have a charge over the remainder.

INVESTUP PORTFOLIO

Despite listing loans from numerous platforms, there were only 10 auctions taking place today. Many were from sites covered elsewhere in this blog – reBuildingSociety, ThinCats and ArchOver.

PERSONAL P2P LENDING

Zopa

Lent to Date:  £1.42 Billion – latest figure available.

Returns: Zopa's 3 accounts offer 3.5%, 4.3% and 6.7% pa depending on the levels of access and whether or not they are covered by the Provision Fund.

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

Ratesetter

Lent to Date: £1,372,997,820 – fortnightly increase of £28,748,299 – 2.14% growth.

Returns: Interest rates are set according to supply and demand. They currently range from 2.8% to 4.8% depending on the length of the investment. The latter figure has been on a downward trend over the past month. This could be a seasonal trend with potential borrowers taking holidays.

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: £32,797,618 – fortnightly increase of £677,754 – 2.11% growth.

Returns: 4.6% and 5.6% for 3 and 5 year investments respectively. These returns have both reduced by 0.1% over the past fortnight.

As well as a Provision Fund to cover investor's finances, 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.