jonah
Member of DD Central
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Post by jonah on Jan 18, 2016 20:54:19 GMT
Some platforms have a solid proposition and continue to use it year after year. This isn't the award for them! Instead this is the award for platforms which are trying to push the envelope. Which platform has come up with the single most significant idea or concept in 2015 which has changed that platform or potential the wider market as a whole? ---- This is one of a set of 7 polls, set up as unofficial awards for 2015. If any mods / admins want to make them official... feel free to remove the 'un' from the subject! Each poll is set up with a list of all p2x platforms which have a board or sub board on this forum. They are in alphabetical order and capitalised based on the forum approach. If I've missed any platform / made any typo's, it wasn't deliberate! Each poll runs until 12AM on Saturday the 30th of January. Everyone gets 1 vote per award. All votes are hidden (including from me, but potentially mods / admin can see the running total based on comments on previous polls) until the end of the poll when the results will be announced. There are no formal prizes for these awards (unless anyone wants to add one) but I will try to 'like' the first post I see from an official rep for each 'winner' in each category. Good luck to all. All the polls for this are listed here: p2pindependentforum.com/post/86176/thread |
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webwiz
Posts: 1,133
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Post by webwiz on Jan 19, 2016 18:32:34 GMT
SS for prefunding
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Post by oldnick on Jan 19, 2016 19:41:37 GMT
AC's QAA, whilst not a high return in itself, is unique in the way it can sweep unused funds to earn at least something while we wait for the return of...I can't remember what... can anyone remember what we're waiting for?
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ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Jan 19, 2016 20:03:14 GMT
AC's QAA, whilst not a high return in itself, is unique in the way it can sweep unused funds to earn at least something while we wait for the return of...I can't remember what... can anyone remember what we're waiting for? Old Mother Holgate to fill up his cupboard and chase the Tinkerman away?  My initial thought was the QAA but then someone threw Prefunding into the ring, and now Im torn.
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ablender
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Post by ablender on Jan 20, 2016 11:17:32 GMT
ilmoro, I'll pull you my way - SS prefunding for new loans.
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Post by oldnick on Jan 20, 2016 15:13:25 GMT
AC's QAA, whilst not a high return in itself, is unique in the way it can sweep unused funds to earn at least something while we wait for the return of...I can't remember what... can anyone remember what we're waiting for? Old Mother Holgate to fill up his cupboard and chase the Tinkerman away? My initial thought was the QAA but then someone threw Prefunding into the ring, and now Im torn. Well, I'm not sure it was advisable to reveal your identity to us Mr.Torn, or may I call you Rip? Loved you in 'Men in Black' by the way
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JamesFrance
Member of DD Central
Port Grimaud 1974
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Post by JamesFrance on Jan 20, 2016 20:51:53 GMT
I voted for Mintos which I think was the first platform to offer buyback guarantees for some non paying loans, including full interest until the buyback date.
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Post by chris on Jan 20, 2016 21:25:13 GMT
ilmoro , I'll pull you my way - SS prefunding for new loans. Is that not based on both AC's old prebid system and AC's distribution algorithm in our marketplace but without the balancing in place to prevent gaming (until recently on smaller loans)? With some of the other innovations mentioned it'll be interesting to see which survive full FCA regulation...
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ablender
Member of DD Central
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Post by ablender on Jan 23, 2016 14:57:27 GMT
ilmoro , I'll pull you my way - SS prefunding for new loans. Is that not based on both AC's old prebid system and AC's distribution algorithm in our marketplace but without the balancing in place to prevent gaming (until recently on smaller loans)? With some of the other innovations mentioned it'll be interesting to see which survive full FCA regulation... I have no experience of previous prebids on AC. I joined AC recently and I still have to see the small amount I put there to be fully lent (excluding the QAA). Re SS prefunding , (which is properly called pipeline) It is more like a wish list that works without needing to transfer money in. Did you have, or currently have something similar on AC? When allocations happen, lenders start earning interest immediately, even before drawdown and better still even before instructing the bank to transfer the money (within reasonable limits set by the platform). I think this is unique and deserves the vote.
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Post by chris on Jan 23, 2016 15:13:51 GMT
Is that not based on both AC's old prebid system and AC's distribution algorithm in our marketplace but without the balancing in place to prevent gaming (until recently on smaller loans)? With some of the other innovations mentioned it'll be interesting to see which survive full FCA regulation... I have no experience of previous prebids on AC. I joined AC recently and I still have to see the small amount I put there to be fully lent (excluding the QAA). Re SS prefunding , (which is properly called pipeline) It is more like a wish list that works without needing to transfer money in. Did you have, or currently have something similar on AC? When allocations happen, lenders start earning interest immediately, even before drawdown and better still even before instructing the bank to transfer the money (within reasonable limits set by the platform). I think this is unique and deserves the vote. As innovation is my bag I'm not going to give that up without a fight  We used to have a pre-bid system that would share out allocations when an auction opened and funds had to be committed based upon your desired amount and your available funds. Our current allocation system lets you set targets against loans before they draw down and then loan units are distributed fairly when the loan draws. So the only novel things about SS's implementation, from your description, are earning interest before a loan draws and not having to have committed funds. I'm sure SS have different advice but my own advice is that both mechanisms are against FCA regulation. SS are not authorised to pay interest unless it is part of an article 36H agreement, so unless they've found a clever loophole you shouldn't be paying interest until the loan has drawn. Likewise paying interest on uncommitted funds would be in breach as I understand it. Finally you have the client money regulations that, at least with our interpretation, completely prohibit investing funds that haven't been deposited in the client money account if those funds can be withdrawn by another user. They may get away with that when selling loan units that they own but that's not always the case with their underwriter model. Likewise they're using the same mechanism on the secondary market which in theory would allow something like the following scenario: lender A deposits £50k, buys loan units, holds them for a while, then sells them; lender B says they'll fund their account with £50k, buys those loan units, lender A is then free to withdraw those funds, but lender B never deposits their £50k. The £50k that lender A had withdrawn would actually belong to other lenders who had deposited cash and were the company wound up and the accounts frozen then the other lenders would lose that money. That is a direct breach of client money rules as we understand them. Again SS may have found a clever loophole that the FCA will be happy with but that is why I said it will be interesting to see which innovations survive as they are. We'll be watching how the FCA deal with these implementations very carefully as they'll be shaping our own views and ideas moving forwards.
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Post by meledor on Jan 23, 2016 17:55:44 GMT
... So the only novel things about SS's implementation, from your description, are earning interest before a loan draws and not having to have committed funds. I'm sure SS have different advice but my own advice is that both mechanisms are against FCA regulation. SS are not authorised to pay interest unless it is part of an article 36H agreement, so unless they've found a clever loophole you shouldn't be paying interest until the loan has drawn. Likewise paying interest on uncommitted funds would be in breach as I understand it. Finally you have the client money regulations that, at least with our interpretation, completely prohibit investing funds that haven't been deposited in the client money account if those funds can be withdrawn by another user. They may get away with that when selling loan units that they own but that's not always the case with their underwriter model. Likewise they're using the same mechanism on the secondary market which in theory would allow something like the following scenario: lender A deposits £50k, buys loan units, holds them for a while, then sells them; lender B says they'll fund their account with £50k, buys those loan units, lender A is then free to withdraw those funds, but lender B never deposits their £50k. The £50k that lender A had withdrawn would actually belong to other lenders who had deposited cash and were the company wound up and the accounts frozen then the other lenders would lose that money. That is a direct breach of client money rules as we understand them. Again SS may have found a clever loophole that the FCA will be happy with but that is why I said it will be interesting to see which innovations survive as they are. We'll be watching how the FCA deal with these implementations very carefully as they'll be shaping our own views and ideas moving forwards. Your comment above which I have highlighted is correct. Saving Stream have stated that its lawyers as well as Grant Thornton have confirmed that its loan contracts are 36H compliant.
I don't follow your point on client money, such as "The £50k that lender A had withdrawn would actually belong to other lenders who had deposited cash", but accusing an organisation of flouting client money regulations is a serious matter.
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mikes1531
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Post by mikes1531 on Jan 23, 2016 18:14:36 GMT
So the only novel things about SS's implementation, from your description, are earning interest before a loan draws and not having to have committed funds. Your comment above which I have highlighted is correct. Saving Stream have stated that its lawyers as well as Grant Thornton have confirmed that its loan contracts are 36H compliant. SS's loan agreements may be 36H compliant, but surely they aren't actually in effect until a loan draws down. I think the point chris was trying to make was that AC's advice told them they can't pay interest to their investors before they're receiving interest from their borrowers. And that's what SS are doing when they pay interest before drawdown, presumably because they received different advice. Aren't legal advisers fun! 
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Post by chris on Jan 23, 2016 18:16:59 GMT
Your comment above which I have highlighted is correct. Saving Stream have stated that its lawyers as well as Grant Thornton have confirmed that its loan contracts are 36H compliant.
I don't follow your point on client money, such as "The £50k that lender A had withdrawn would actually belong to other lenders who had deposited cash", but accusing an organisation of flounting client money regulations is a serious matter. I'm sure they do have their advice and they could well be correct in their interpretation. The FCA's regulations are open to interpretation in many areas which is why all the platforms are spending hundreds of thousands of pounds on compliance advice. Don't forget we also work with Grant Thornton. Their old loan contracts were to Lendy rather than the third party borrower which isn't article 36H compliant but I'm sure their recently introduced contracts are. That doesn't mean that SS are only paying interest in accordance to those contracts, it's quite possible that they are seeing the payment of interest on undrawn funds as a promotional item which would be outside article 36H and down to how the FCA enforce their regulations. We're expecting a fair bit of clarity on that once the major platforms have completed their FCA application process. For the client money piece take I'll run through a simplified scenario: 1) Client money account is empty. 2) Three lenders deposit £50 each and two of them go on to fund a £100 loan. 3) The loan is drawn down leaving £50 cash in the client money account belonging to the third lender, Charlie. 4) A new lender, called Bob, registers and says they'll deposit £50. They don't transfer the money immediately so the client money balance is still £50. 5) One of the original lenders, Arthur, decides sell his £50 stake. 6) Bob buys Aurthur's loan unit for £50 but still hasn't deposited any money. 7) Arthur withdraws his £50 cash that was paid for his loan unit leaving £0 in the client money account. 8) If Bob doesn't make his £50 deposit before Arthur withdraws then whose actual money is he withdrawing? The £50 in the client money account belongs to Charlie who was not part of that transaction. I'm not accusing Saving Stream of having that implementation, I have no idea what they're doing behind the scenes. They could be shuffling hundreds of thousands of pounds around each day to manage this situation and fund the deposits themselves, although that is a logistical nightmare as you're not allowed to leave the platforms funds sat in the client money account - they must be segregated. The FCA are explicit in that simply promising to pay for a shortfall is not enough, you must have the cleared funds in the client money account. This is to protect lenders from platform failure along the lines of what happened with TrustBuddy. If SS truly have a full blown solution that automatically moves their own funds around to cover deposits as they are made and reconciles everything then that would be an impressive piece of technology of similar complexity to the QAA, so I would be happy to have the two solutions slug it out for this coveted prize.
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Post by bracknellboy on Jan 23, 2016 18:56:15 GMT
So the only novel things about SS's implementation, from your description, are earning interest before a loan draws and not having to have committed funds. I'm sure SS have different advice but my own advice is that both mechanisms are against FCA regulation. SS are not authorised to pay interest unless it is part of an article 36H agreement, so unless they've found a clever loophole you shouldn't be paying interest until the loan has drawn.
... Not on SS so can't comment on what they are actually doing. But could it be that the connundrum and its solution lies in your own post. You have used the terms 'earn interest' and 'pay interest' as if they are interchangeable. The requlations simply (not would be simple of course' actually result in a bar in paying interest, but not in earning / accruing ?
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Post by chris on Jan 23, 2016 19:34:22 GMT
So the only novel things about SS's implementation, from your description, are earning interest before a loan draws and not having to have committed funds. I'm sure SS have different advice but my own advice is that both mechanisms are against FCA regulation. SS are not authorised to pay interest unless it is part of an article 36H agreement, so unless they've found a clever loophole you shouldn't be paying interest until the loan has drawn.
... Not on SS so can't comment on what they are actually doing. But could it be that the connundrum and its solution lies in your own post. You have used the terms 'earn interest' and 'pay interest' as if they are interchangeable. The requlations simply (not would be simple of course' actually result in a bar in paying interest, but not in earning / accruing ? Possibly if lenders are not paid those funds if the loan doesn't go ahead and draw down, and it's in the loan agreement that the borrower will pay them to the lenders. As it's labeled interest SS have to be careful as they cannot pay interest on deposits only Article 36H loan agreements.
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