ReBuildingSociety improvements

April 22nd, 2013

ReBuildingSociety has announced it is making changes and improvements to its service for both lenders and borrowers.  From this Friday it will be implementing a cap on lending rates, as a function of loan risk.  In comparison Funding Circle have a 15% cap across all markets, but most loans fall to sub 10% after being listed for a few hours.  ReBuildingSociety are also changing the bids so that smallest bid increment is 1% rather than the current 0.1%.

There will also be a new category of "people money" loans introduced in the future where lenders, in return for a higher rate of interest, are required to offer some form of "help" to the business, such as purchasing its products or services.

Here is the full statement from ReBuildingSociety:

We’re pleased with our success to date. We’re growing and we’re attracting plenty of new borrowers. Some of these are long-established and profitable businesses, which would have options to borrow elsewhere.

So we’re improving our platform:

What’s changing?

As of Friday 26 April, the following bid caps will apply to businesses listed on our website:

· A-rated business: Max bid 14%

· B-rated business: Max bid 17%

· C-rated business: Max bid 20%

We’re also increasing the incremental amounts at which anyone can bid from one decimal place to whole numbers. So bids will be made at 19%, 18%, 17% rather than 19.1% or 18.5% etc.

Why are we doing this?

We’ve listened to our community, who’ve given us valuable feedback and we’ve acted on their suggestions.

One consequence is faster loan completion. Only making bids with whole numbers will allow the rates on loans to reach the ‘market rate’ quicker – i.e. the level that people will not bid below. A lender will still get the rate they feel is commensurate with the risk, providing they are not outbid, and it improves the rate for borrowers, who are more likely to recommend the service to others and keep the right quality of deals coming through to the site. As a lender, the earlier you bid, the more likely you are to get the best rates.

What this all means

All bids made before Friday 26 April will stand at the original rate, so there is a window of a week to place higher bids on existing A and B applications where the maximum will soon be lower.

Coming soon: High value loans

A largely untapped area of potential in this market is for lenders to become “ambassadors” for their borrowers. We’re shortly going to be introducing an option for borrowers to choose a ‘high value loan’ listing, where high rates of interest are able to be attached to bids, but in return lenders are asked to help that business out in some way. Possibly by promoting it to contacts, purchasing a product / service or even offering to become a non-executive director.

We want value to be created through our platform in a way that institutional finance just doesn’t allow. We call this “people money” and there will be much more on this in the coming weeks and months.

Please get in touch if you need any more information.

Nick, Dan, Julian, Jeremy and the team

We are very interested in these "people money" loans as this is something that could only be done through peer-to-peer lending.

Earn cashback with Funding Secured

April 17th, 2013
Funding Secured

Funding Secured is one of the latest entrants into the peer-to-peer world focusing on secured loans to businesses.  The P2P money website have teamed up with them to offer cashback on both lending and borrowing.

Funding Secured only offer loans secured on assets, and they are looking for high net worth lenders who want to earn a decent rate of return for a lower risk investment.  Here is what they have to say: differs from most Peer to Peer Lending websites as we only make Secured Loans to Businesses. By Securing the Loan against an asset such as a House or a Commercial Property, you significantly reduce the chance of losing the money Loaned, because if a Business defaults then the Secured asset can be repossessed. In such circumstances the Lender will usually recover all their money together with the Interest due.

Loans are made to a Business in exactly the same way that a bank or building society would advance a mortgage or other large Loan. A Solicitor acting for the Lender will Secure the Loan by taking a legal charge on a suitable asset. The asset that the Loan is being Secured upon will require independent valuation and must represent adequate Security. offers Investors access to Businesses with differing financial needs. The Term of the Loan and the Security offered will vary, with some Borrowers looking for short term bridging Loans and others looking for longer fixed term Loans. With all the Loans are Secured against an independently valued assets and we all know that a Secured Loan is a safer Loan.

Businesses can decide what type of loan they require, (subject to our minimum loan amount of £25,000), over what period they want to pay it back and the interest rate they are prepared to pay.  Funding Secured will advertise you requirements and match you with lenders willing to advance a loan.

Zopa report large growth in lenders

April 15th, 2013

Zopa have just reported a tripling of new lenders in the first quarter of 2013, compared with the first quarter of 2012.  This is an amazing achievement for Zopa, the company that started peer-to-peer lending in 2005.  We should also recognise that every 4 to 6 new lenders (on average) allow a new borrower to get a low rate loan through the Zopa platform.

Here is the full statement from Zopa:

Financially savvy savers are flocking to inflation-busting rates of 5.1% in a bid to get a good return. Figures released today from Zopa reveal a 197% uplift in savers across Q1 2013, compared to the same period in 2012.

With 2,291  savings accounts currently available in the UK and only five of those providing rates that are in-line with the Consumer Price Index (CPI) of 3.5%, the vast increase in the take-up of Zopa’s offering is not surprising. Bringing the peer-to-peer lending solution into the money mainstream, Zopa currently has over 39,000 active savers who have lent in excess of £290million since its inception in 2005.

Each saver has enabled borrowers to get an affordable, low-rate loan and ensured they will earn above the regular rate of interest. As a result of the uplift in savers lending through Zopa in Q1 2013, 45% of borrowers have been able to purchase a new car, 21% have been able to undertake home improvements and even 2% can cover their wedding expenses. This circle of smart money is fuelling the purchase power within the economy and providing savers and borrowers with rewarding options that are outside of traditional financial institutions.

Giles Andrews, CEO of Zopa said “Since 2005 Zopa has been enabling savers and borrowers to connect and get a better financial deal. Our savers and borrowers are extremely smart and sensible with money, so the 197% growth we’ve seen in the first quarter of 2013, compared to the same period last year, doesn’t surprise us given the poor rates offered by banks.”

Zopa is a keen champion of the sector and always tries to enhance the work being undertaken to regulate the industry by the Peer-to-Peer Finance Association.

This goes to further illustrate that 2013 is the year that peer-to-peer lending goes mainstream.

Assetz Capital offer cashback

April 10th, 2013
Assetz Capital

Assetz Capital, one of the new entrants into the P2P market this year, are now running a 0.5% to 1% cashback for lenders.  Cashback is available up to the 30th June 2013 on successful bids.

ReBuildingSociety on CrowdCube

March 31st, 2013

ReBuildingSociety, one of the new peer-to-business lenders has itself turned to crowd-funding in order to grow its business.

Here is the email send by ReBuildingSociety on Easter Sunday:

We’re excited to announce that we’ll be sponsoring a crowdfunding podcast that will interview borrowers and gives us a new way to communicate the borrower’s company. We’ll let you know when the first episodes are ready, mid-April. You’ll be able to subscribe to it on iTunes.

Our own equity-based fundraising pitch is progressing on CrowdCube... We’re at 4% of our £140k target, having received investment from a few of our lenders. Instead of taking growth funding from a VC, we’ve turned to the crowd. The shares qualify for SEIS allowing investors to offset 50% Income tax PLUS 28% capital gains. Also early investors get an extra 10% of shares. It would be a pleasure to have more members of our community as shareholders, so I invite you to invest in us. The forum makes for an interesting read.

I hope you enjoy your Easter break,

Kind regards,

Dan Rajkumar & the team