Funding Empire Now Offers Asset Backed Loans

Funding Empire LogoFunding Empire entered a cooperation with the Business Lending Exchange (BLX) to offer asset backed loans on the marketplace. These new asset backed loan investments will be backed by realisable security and go through BLX’s proven and experienced credit assessment process – they will be available to Funding Empire investors from tomorrow.

Parag Patel is managing director of Funding Empire, a growing peer-to-peer business lending platform. Announcing the new product, he said: ‘This is the first step in an ambitious plan to deliver a number of different peer-to-peer investment products that we have designed to cater for all kinds of investors and their varying risk profiles. Asset finance offers funding for businesses and is a long established traditional finance product backed by tangible security. In this new model our lenders will receive monthly capital and interest repayments, unlike many other asset backed lending repayment structures that defer payment of capital and sometimes also interest, until the end of the loan term. We have had huge demand for a non-property based, asset backed product that provides monthly income – and we’ve responded to that demand.

Loans under this model will be for a maximum of 50,000 GBP over a maximum term of 3 years providing monthly capital and interest repayments to lenders. Loan requests will typically last between 5-7 days and will operate as fixed rate auctions. They will end either when the loan request is filled or it expires. Loan parts from this model can be traded as normal on our secondary loan market.

All loans will be granted to BLX and as with our current procedures, security will be held by Funding Empire Security Trustee Company Limited, on behalf of the investors.

Funding Empire says BLX has provided as follows:

  • A debenture granted to Funding Empire Security Trustee Company Ltd. (FESTC) over their loan / hire agreements in relation to the loan being offered. This also covers the assets under the agreements and FESTC will be the only debenture holder.
  • An executed assignment notice over their relevant loan / hire agreement, which is signed and sent to Funding Empire when BLX draw down a loan from us.
  • Appointment of a Funding Empire director to the BLX board to monitor their lending activities, day to day operations and represent our lenders interests.
  • Ongoing access to their live loan book which Funding Empire will monitor on a daily basis.
  • Ongoing access to their internal finances, processes and procedures which Funding Empire will monitor regularly.
  • Ongoing access to their financial affairs including financial reporting standards / methods and their board meetings.
  • Agreed parameters for deals to be placed on the platform i.e. asset types to be excluded, maximum loan term, maximum loan amounts, maximum LTV’s (Loan to Values) etc.
  • Agreed that no loans in arrears, default or with a history of poor repayments are to be placed on the platform.
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