Hi all,
It has been a busy period in the peer to peer lending world, following Funding Circle’s announcement to switch from a traditional auction based model to a fixed interest model. Judging by the feedback from investors there is a lot of disappointment with this decision, even Funding Circle have stated that 29% of investors will see substantially lower returns. Me included. I am currently yielding 9.7%, but with the change to fixed rates this will drop closer to 7%. I understand the reasons from a business point of view to secure the lending rate at the start for the borrower and to entice to new/less sophisticated lenders, but still it’s a large drop in yield for long term and loyal lenders.
So I have already started reducing my lending exposure with Funding Circle and started lending with a new UK platform, ABLRATE, an asset backed lender focusing on aircrafts and capital equipment. So far I have been impressed with its recent offerings and I am averaging 11% interest, secured on assets and paying back monthly.
Will continue my strategy of reducing Funding Circle into higher yielding platforms.
One thing I am currently seeing on a number of platforms are falling yields as more investors register and the number of borrowers do not grow by the same amount. But for the present, the yields and returns are still worth investing compared to any other asset right now.
Peer to Peer Lending Investor