I love unusual marketing ideas. Therefore I contracted Ross and Ed, 2 british students, to ‘advertise’ P2P-Banking and to support them in their quest out of college debt. You can read about their idea at BuyMyFace.com.
UK
UK Borrowers Benefit From Lower Interest Rates at Ratesetter
Borrowers needing a small loan can turn to p2p lending marketplace Ratesetter, which matches borrower requests with funding supplied by private lenders. Borrowers can choose a variable rate loan (rolling loan) or a 36 months fixed rate loan. Nominal rates for the 36 months loan have fallen considerably in the past six months from approx. 9% to now under 7% (that translates to a representative APR of slightly under 9%).
Ratesetter has facilitated over 10 million GBP in loans since its inception.
Last week Ratesetter completed raising series C round of funding, raising 1.5 million GBP (approx. 2.35 million US$). The total amount raised so far is 3 million GBP.
RateSetter CEO Rhydian Lewis said: ‘…RateSetter is continually working to narrow the spread between what Savers can earn on their money and what creditworthy Borrowers can pay. This investment will ensure that customers will continue to get great value and a great service‘.
Civilised Money Raises 100K Through P2P Equity
UK startup Civilised Money has raised 100,000 GBP from 121 individual investors using the p2p equity platform Crowdcube. The investors will own 10% of the funding after the legal process of the funding is completed. The funding was completed in just 9 days, showing the potential p2p equity has in the UK.
Civilised Money plans to offer crowdfunding first and p2p lending in a second step. Katherine Byles of Civilised Money told P2P-Banking.com earlier this week that this is actually the second funding round for the company: ‘We have a first round of crowdfunded investment from ‘The Pillars’ 20 key supporters.‘.
Asked whether the technology is self-developed or licensed, she told P2P-Banking.com: ‘The technology is licensed. We have a one-off revenue share based licence for one of the most powerful and flexible P2P platforms available.  Through the core technology platform we will be able to roll-out a number of products, enabling us to cut the cost of using these – once funds are on the platform moving them between the different products is a simple and fast process.‘
Asked about the USP as compared with Zopa, RateSetter or Fundingcircle Byles said: ‘Civilisedmoney will offer all the people-to-people financial services products in one integrated service.  It has launched with crowdfunding. People-to-people loans are coming next. It is developing new products too. Civilisedmoney is becoming a one-stop-shop for all your people-to-people financial products that create a viable alternative to banks. …‘
The company has ambitious goals as a quote from information provided in the pitch shows: ‘While its service is not yet available in the U.S., CivilisedMoney’s plans are to expand from the U.K. to greater Europe, and then eventually to Africa and the U.S. (CivilisedMoney’s services offered will depend on region, since, for example, crowdfunding equity stakes for startups isn’t yet legal in the U.S.)‘.
RateSetter Finishes Successful First Year
In England p2p lending service RateSetter celebrated it’s first year in business anniversary a few days ago. The loan volume matched is close to 9 million GBP, spread out over 2.400 loans.RateSetter has currently about 65.000 members.
RateSetter has a rather unique business model in the p2p lending landscape which builds on anonymously matching demand and supply for two loan “products”: 36-month loans and rolling loans (the total loan volume is spread nearly 50:50 on these products).
RateSetter says that due to the provisions fund mechanism “every single RateSetter lender has received every single penny of capital and interest that they expected.“. The fund is an instrument set up by RateSetter to “reduce the risk for lenders“. Borrowers pay an amount upfront into the Provision Fund based on their creditworthiness. Yesterday RateSetter announced that on Sep. 3oth the team managing the Fund decided not to distribute any money from the Fund back to the lenders, which is possible if the team considers the Fund to be excessivly capitalised.
Borrower representative APRs ranged from 7.6% to 11.6%. 79% of borrowers are homeowners. The two purposes car loans and home improvement loans were given for more than 50% of the loans. In the last six month, interest rates for 36 months loans on RateSetter have been falling, whereas the rates for the rolling loans remained mostly at the same level.
RateSetter is a founding member of the Peer-to-Peer Finance Association (see: ‘Peer-to-Peer Finance Association Founded by British P2P Lending Services‘).
(Source: RateSetter)
Crowdcube a Winner of Smarta 100 Award
P2P equity site Crowdcube is a winner in the Smarta Top 100 Award 2011. The Smarta 100 is “a celebration of the most resourceful, original, exciting and disruptive small businesses in the UK“. Crowdcube has been selected in Top 5 for “Innovation”. Users can still vote for their favourite company on the Smarta site.
Funding Circle Allows Multiple Loans and Higher Risk Loans
Funding Circle will allow multiple loans by the same borrower and also open up to “C” rated borrowers which were so far excluded from loan funding. These changes will be enacted on Sept. 19th. In the blog Funding Circle explains the reasoning for allowing multiple loans:
Businesses typically have multiple finance needs throughout the year, for example they may need finance to purchase new assets or to fund new projects. Previously at Funding Circle, businesses were restricted to one outstanding loan. Many of our borrowers have come back to us with new finance needs and until now we have not been able to help them. In addition, a number of very creditworthy businesses have previously borrowed up to 50,000 GBP with Funding Circle when our maximum loan limits were lower, but which would have always passed our underwriting models for larger loan amounts (our current maximum is 100,000 GBP). …
and for introducing “C” band loans: Continue reading