There are many FCA regulated peer-to-peer lending businesses operating in the UK market today.
In fact, there are so many that it’s become almost impossible for private investors to recognise the differences between the various platforms without dedicating a significant amount of time towards researching each platform individually.
To help tackle this problem, I’ve written an all-encompassing four-part guide providing a useful overview of the UK-based peer-to-peer lending platforms operating within the consumer, business and property-backed lending sectors.
In particular, I will aim to provide clarity over:
- Type of loans provided
- Secured vs. unsecured debt and the seniority of debt security offered
- Target interest rates and cashback offers
- Existence of a provision/protection fund
- Term length of underlying loans
- Availability and cost of using secondary market to gain early access to funds
- Options for self-select / automatic lending
- Availability of IFISA accounts
Hopefully you will find this useful in beginning your assessment of the risk/return offered by various platforms.
Disclaimer: I must note that I am not a financial advisor and no commentary included within this article should be construed as financial advice. Please, as always, do your own research. Capital risk is inevitable with any investment when venturing outside of FCSC protected bank savings accounts. You as an investor should pursue a strong understanding of the level of risk involved with each investment and should be comfortable that the target returns on offer are proportionate. Gaining this understanding is possible by understanding the underlying loans and security accepted by the various peer-to-peer platforms.
Start reading our peer-to-peer lending guide by clicking the links below: