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RateSetter increases cashback to £20
RateSetter has increased their cashback offer to an amazing £20 for new lenders who invest and lend out £100 or more by 31st January 2013, which represents up to a massive 20% return on investment. With rates on the 3 year and 5 year fixed rate loans starting to rise, now is an excellent time to become a lender on RateSetter.
RateSetter is the only major peer-to-peer provider to have a provision fund, which will step in to refund lenders if the borrower cannot repay for any reason. While this isn't a guarantee, no lender on RateSetter have lost any money at all to bad debt. Default rates are currently 0.29% which is very low compared with the industry.
Unfortunately that’s not the case for monthly access or 1 year bonds which are now at bad joke levels.
To prove the point, the following is a screen shot of the Ratesetter site taken at 19:00 hours 13/01/13:
AERs available now
1 YEAR BOND
3 YEAR INCOME
5 YEAR INCOME
I repeat the suggestion I made last year that “City Boys” are manipulating the monthly access market in order to borrow at ridiculously low rates in order to “short” on other investments and repay the RS loan out of the profits.
Nothing illegal in that but that’s no consolation to small investors looking for a reasonable return and a good reason to avoid Ratesetter until rates return to a sensible level.