SM INPL Credit limit based on your account balance

We were all doing alright until the last couple of pages 

In all honestly not too bad ; I think we have come to a fairly conclusive conclusion in regards to the INFPL credit proposal

You know; 99% of the members on this forum are great guys, who regardless of their differing view take part in constructive discussions that at the end of the day can only better the SS platform.  Along with that, these same members provide good and friendly advice, tips and genuine help to other investors (new & old alike).

The other 1% sling proverbial s*** at the PC screen to see what sticks.....

boble
The issue isn't so much whether it's possible to SUCCESSFULLY cheat the system, as whether people BELIEVE they can cheat the system, and are therefore encouraged to try.

If it appears that you can make money by continually churning loans without ever paying for them, then some people will likely attempt to do so. As has been pointed out, SS only actually pay out interest monthly, and should therefore be able to catch those who cheat, but it's entirely possible that damage will have ALREADY been done.

It's also worth noting that problems appear to have come to a head on the day when interest is paid out, with large quantities of loans being placed back on the secondary market. This is exactly when I would expect the problem to materialise, because if you're going to pull this con off, near the end of the month is the right time to begin. The fact that it was next to a weekend as well may also have helped, since oversight would likely be less.

The solution really is quite simple though - by limiting credit to the existing size of investment, the problem vanishes. The only matter for debate is how to treat new users, I have suggested £2,000 of credit whereas CD has suggested £10,000, which I think is over-generous. That said, I dare say SS have already come to a decision, and are simply waiting for the code to be written before they announce it. It's not a five minute job, but it's not overly difficult either - it'll certainly be sorted before the end of the month, if not the end of the week.

I expect the £10k was suggested because that's the number that SS already use as the amount they're willing to let a new user set as a pre-fund for a pipeline loan.

Primarily, gaming is a term used by us investors where we "game" the PM pre-funding allocation for >1m loans.  All these loans you get a % of your allocation, so we game the system by second guessing how much over funded the pre-fund loan is.  So if we guess that the pre-fund loan is 2x overfunded, but we want £5000, then we would set our pre-funding to £10,000.

However, in this post, I am referring to where it seem some investors are gaming the SM, where they are investing in everything that comes onto the SM, then sells the same investments back onto the SM 48hrs later (or lets SS do it) to benefit from the interest.  There seems to be some confusion whether or not interest is indeed paid in this scenario, but in any case, SS have confirmed they are having to place investments back onto the SM because investors have not settled a negative balance.  As such, there are cases where there are 100s of thousands (sometimes millions) which are "floating", not earning interest for genuine investors.

I think if they never pay then they do not get the interest but there is nothing stopping someone buying a £1000 worth for example keeping it for two days and then selling something else to clear the balance and then do it again a few days later

In that scenario would they get interest for those two days on £2000?