YES-secure to rebrand itself

November 20th, 2011
YES-secure

After my recent post on YES-secure suggesting they had gone quiet, today they have announced some changes and that they are looking to rebrand themselves at the start of January 2012.  Here is the full post on YES-secure.

1) We are working on launching business lending and are currently evaluating operation our BETA business lending platform. We will focus on marketing this new service once we have also completed our current rebranding process by the end of this year.
2) We added an application fee to encourage borrowers to make more complete and serious applications. We will now revise this application fee to be nominal £5 for consumers and £50 for businesses.
3) We are completing a new branding and reorganisation of our website which we expect to launch from the beginning of January 2012. We would welcome our members feedback on changes in website organisation under the topic "Website rebranding suggestions".
4) We are continuing to learn and improve our internal processes including underwriting, fraud mitigation and debt collection.
5) YES-secure is fully committed to be the first P2P Lending Platform that supports and encourages both Consumer and Business Lending.

Dr Chandra Patni
Director

This announcement also confirms that YES-secure are reducing their £20 non-refundable application fee to £5, and this may after I posted an few links on their forum suggesting they may not be complaint with the law.  It is also interesting they are looking to improve their "fraud mitigation" which itself raises some more questions.

YES-secure go quiet

November 18th, 2011
YES-secure

There has been a lot of comment on the YES-secure forum that (ironically) there has been no communication from YES-secure themselves.  Below is a posting from MRC_London on the YES-secure forum that sums up the situation:

It is now very nearly six weeks [since my last posting on this topic]. In that time just a single loan has been disbursed (listing expiry 13th Oct) with the previous two disbursements having listing expiry dates of 2nd Oct and 29th Aug respectively. (Just to reinforce the point that is just 2 loan approvals from all the Sept, Oct , & early Nov listings)

There has however been a steady (although not spectacular) stream of £20's being supplied to YS for the privilege, in most (?) cases, of being denied a verified listing.

As things stand this evening, we have the pitifully small collection of 2 live listings, 1 expired listing awaiting borrower acceptance, and 3 listings awaiting underwriter approval. With no listings awaiting verification prior to go live.

On this evidence, together with the lack of recent communiqués from YS commenting on strategic direction, I stand by my opinion that we are witnessing a "soft closing" of the platform.

MRC_London

After the recent demise of Quakle there is understandable concern surrounding the fate of YES-secure after lenders started posting that they had experienced higher than expected bad debts so early on in the loan.

P2P Money has attempted to contact YES-secure to ask about bad debts, and we are still awaiting a response.  We hope the situation can be resolved quickly and we await a positive response from YES-secure.

Predicted vs. actual bad debts

November 17th, 2011

Most peer-lenders give predictions on what bad debt a lender should expect either annually or over the lifetime of a loan.  Unfortunately the occurence of a bad debt isn't spread uniformly over the period of a loan.  For several years Zopa was reporting 0.05% lifetime bad debt until the credit crunch hit.

P2P Money has analysed the major peer-lenders and published an analysis of actual bad debt against predicted bad debt, along with a figure indicating how well they performed to estimates.  This will be tweaked over time as more data becomes available.

In summary, all of the major peer-lenders that have published data have performed better than their estimates.  This is good news, but as some of these lenders are expanding quickly, some loans won't have been around long enough to go bad.  I will let readers draw their own conclusion on any companies that haven't provided any data.

Publicising P2P

November 15th, 2011

One of the most annoying things - and one of the reasons why P2P Money exists today - is that information on peer-lending in the press can at best misleading, and at worse wrong.  Peer-lending is - to most people - an unknown concept which needs further explanation.  It can't be compared directly with classic savings, but unfortunately it is, giving rise to further confusions.

Peer-lending isn't risk free, and some lenders have experienced negative returns, however that was either due to poor diversification (spreading your money around) or problems with the peer-lender itself.  Unfortunately negative stories sometimes carry more weight than positive ones.

I would strongly encourage potential lenders to review the lending rate comparison which shows the rate the lender can expect to get after fees, bad debts and taxation.  I have personally written reviews on the major peer-lenders in the UK and published actual bad debt information, so potential lenders can see how a company is performing to their estimates.  P2P Money won't publish data we don't believe is correct or reliable.

civilisedmoney raises £100,000

November 11th, 2011

A few days ago I mentioned that a new company - civilisedmoney - would be entering the peer-lending market in Q1 2012.  They managed to raise £100,000 by selling 10% of the company by crowdfunding, which is quite an amazing achievement.  I look forward to see what further innovation they can bring to the peer-lending arena.