pikestaff
Member of DD Central
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Post by pikestaff on Sept 7, 2015 13:46:35 GMT
...And if you think the change is an attempt to manipulate rates, well the returns this week seem to dispel this as a successful ploy! Not me. I'm not one of the conspiracy theorists. But I do still think it's a big mistake.
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Post by contangoandcash on Sept 7, 2015 14:50:37 GMT
If say, you were looking at the 5 year market, and the lend it now rate was 5%... but on the 3 year market there was a request to borrow at 5.3%... I'd like to think that a lender that decided 'lend it now' was the right choice, would automatically get 5.3% at 3 years (best execution), or at the very least be told "there are better rates if you choose to lend for 3 years", where lending for a shorter time scale at a higher rate is obviously preferable... obviously this wouldn't pop up if the same applied the other way around, the lender is simply choosing a shorter time scale and would expect a lower rate.
If this is not the case currently, then I'm firmly in the 'people are getting screwed over' camp, and it would need putting right.
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Post by westonkevRS on Sept 7, 2015 18:00:15 GMT
Whilst that is true it doesn't account for lowball rates set by newbies dragging the market down for more experience / patient lenders. True, and I think that is the root cause of most experienced lenders's concern on this forum. It would make some sense, but since the change if anything the MR has been higher than average at this point in the month. Demand hasn't been higher and the rate of new lenders has been consistent, so I don't think these worries are becoming actualities. @ westonkevRS
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jlend
Member of DD Central
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Post by jlend on Sept 8, 2015 12:53:10 GMT
...And if you think the change is an attempt to manipulate rates, well the returns this week seem to dispel this as a successful ploy! Not me. I'm not one of the conspiracy theorists. But I do still think it's a big mistake. I'm uncomfortable about this as well. Change is often not easy though :-)
I'm uncomfortable not for me, but for the few lenders who appear to be setting rates very low when they could easily get a higher rate just waiting a few hours in some cases. This display change may increase this happening, I don't know either way.
I am all for making Ratesetter easy to use.
There is a fine line between "making things easy" and not making it clear how the market works and what options new/in-experienced lenders have.
Ratesetter set out with the aim of creating a simple market where lenders and borrowers set their own rates. It was easy to understand, I signed up in Dec 2010 because of this, my first P2P experience.
I appreciate some lenders may need more support to help them get the best out of the ratesetter market and that there is a cost to ratesetter for providing this support. Hence ratesetter trying to cut down on the number of queries from lenders by making the customer journey "easier".
Financial education generally needs improving in this country. I just think the change needs a bit more thought to help inexperienced users get the most out of the market
Ratesetter and it's investors set out to be better than banks for lenders and borrowers - I'm sure they can do better than this given the innovation they have bought to the market over the last 5 years :-)
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Post by geoffrey on Sept 9, 2015 8:29:44 GMT
I think that is the root cause of most experienced lenders's concern on this forum. It would make some sense, but since the change if anything the MR has been higher than average at this point in the month. Demand hasn't been higher and the rate of new lenders has been consistent, so I don't think these worries are becoming actualities. @ westonkevRSI understand you have a position to defend, westonkevRS , but I hope you're also listening. The very problem is the differential between the "lend now" rate and the "market rate". The market rate has a fair algorithm behind it, designed to get a good, balanced rate for lenders who want to reinvest their funds automatically. It is an example of good engineering in general, and an example of how the "old" RateSetter worked to balance the interests of lenders and borrowers. The "lend-it-now" rate is ludicrous -- it is essentially set entirely by borrowers and completely destroys the market balance the "old" RS tried so hard to achieve (and which made it a roaring success IMHO). Compare the train fare fiasco in this morning's papers. RS is acting like the train companies with naïve customers. You have conspired together not to tell new customers about the best rates (fares) on offer. Your attitude is like that of the advice given to sales staff at some of these train companies: assume customers have done their research, and don't offer them the best fares when they walk up to buy a ticket. This is rightly causing outrage in the press, and I don't want to see RS go the same way. The wider the differential between the lend-it-now and the market rates, the WORSE the situation. Therefore your comment shows you really don't "get it".
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