bigfoot12
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Post by bigfoot12 on Nov 3, 2016 9:50:10 GMT
1. RS puts itself forward as an innovative finance P2P business. Giving this up in exchange for "dealing with professional clients" and matching institutional lenders to commercial borrowers puts it in direct competition with traditional "FCA regulated financial services". If it gives up its distinctive P2P engagement, it loses its unique selling proposition and, sooner or later, the traditional market will catch up and out compete them. Unfortunately, a substantial number of posters on this forum don't seem to accept innovation and treated every announcement from RS (and AC) as though it was the work of some malign force trying to steal their money. It doesn't seem crazy that the provision fund might invest in some loans - I don't leave all of my money sitting around on deposit at 0%, nor does an insurance company. Yes, RS could have handled it better, but I'm not sure they deserve the abuse seen sometimes on this forum. 2. A previous poster suggested that businesses don't engage with their customers. Successful ones do. Good businesses invest seriously in social media engagement as a modern, cost-effective way of staying in touch. RS do engage. They hold events around the country and are easy to speak to on the phone. 3. I guess that posts in this forum are a valuable input to RS which have helped them forge their business model and avoid serious mistakes - whether they recognise this or not. It is hard to know how representative this forum is of investors generally. And there is a noisy minority.
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adrianc
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Post by adrianc on Nov 3, 2016 10:36:24 GMT
4. You make a good point about compliance. You can't let any employee enter free discussions ...so give up on customer engagement and broadcast silence? ...or work hard to find a workable way to engage? That's a valid point, but it's one that doesn't actually vary by the engagement media. If a platform are answering questions on the phone or by email then, so long as those answers are not individual-account-specific, they could equally be given on a forum or social media or blog or...
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bigfoot12
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Post by bigfoot12 on Nov 3, 2016 11:42:35 GMT
That's a valid point, but it's one that doesn't actually vary by the engagement media. If a platform are answering questions on the phone or by email then, so long as those answers are not individual-account-specific, they could equally be given on a forum or social media or blog or... My guess is that it would be hard for anyone else to rely on something said on a phone call other than the caller. Whereas many might claim to have relied on a comment posted on a site by someone labelled as a representative. Also these comments remain for a long time, but perhaps they are no longer applicable .
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DeafEater
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Post by DeafEater on Nov 3, 2016 12:00:01 GMT
1. RS puts itself forward as an innovative finance P2P business. Giving this up in exchange for "dealing with professional clients" and matching institutional lenders to commercial borrowers puts it in direct competition with traditional "FCA regulated financial services". If it gives up its distinctive P2P engagement, it loses its unique selling proposition and, sooner or later, the traditional market will catch up and out compete them. Unfortunately, a substantial number of posters on this forum don't seem to accept innovation and treated every announcement from RS (and AC) as though it was the work of some malign force trying to steal their money. It doesn't seem crazy that the provision fund might invest in some loans - I don't leave all of my money sitting around on deposit at 0%, nor does an insurance company. Yes, RS could have handled it better, but I'm not sure they deserve the abuse seen sometimes on this forum. Ahem, sorry but your comparisons between what RS was doing with their provision fund and the way other entities handle idle funds are invalid. You compare to them to:
(a) yourself which is invalid because as a private individual you are perfectly entitled to invest in anything you choose, however daft, as long as it's legal
and (b) an insurance company which has a wedge of insurance premiums that may/will be called upon to pay out in the event of an insured eventuality coming to pass. I agree it is perfectly valid for an insurance company to invest a portion of the premiums in safe, liquid and probably low yield investments and RS currently does this with the provision fund. However if an insurance company were insuring BP oil platforms and used the premiums to buy shares in BP (an asset guaranteed to fall in value if the insured event occurs), that's dumb and was also in effect what RS was doing by providing funding for new loans from the provision fund. The only redeeming factor in the RS pyramid scheme was that the money loaned was short term, with a view to off-loading it onto normal investors over a few weeks. However in the event of a run on withdrawals, the provision fund would have been forced to carry on holding the loans which would have left less in the pot to cover defaults.
There is a difference between innovation and sophistry.
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Post by easteregg on Nov 3, 2016 16:36:10 GMT
I'm writing this in a purely personal capacity. I was one of the first users to signup to Zopa talk as it was great to be able to communicate about this new innovative finance product. I welcome any company involvement on these board, officially or unofficially, but as companies grow they will want to restrict unofficial comments which is understandable but I would like to see an official line of communication.
Perhaps we can praise the companies that do actively engage with the forum, which may force the hand of those companies that do not wish to participate. Time for another poll?
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Post by newlender on Nov 4, 2016 5:49:03 GMT
As a relative newcomer to P2P I must say that I see this move as retrograde, although I can see the logic in some of the points made here. I have found Kevin's posts and replies very informative and now feel that I know a great deal more than I did at first. But surely the main point is that, if there is no 'insider' on the forum, people will stop making points that only someone with in-depth knowledge of RS can really answer or give a view on. Also, Kevin's answers gave a lot of detail about the workings of RS which couldn't really be gained without firing off numerous emails to CS. For instance, there was a weekend a while back when payments seemed to stop. I was concerned, thought of emailing CS but then remembered the forum. The posts here, plus Kevin's input, put me in the picture. And of course the whole re-investment into the provision fund saga was actually sorted out here as Kevin was actively involved. Great shame!
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Post by ruralres66 on Nov 4, 2016 9:16:07 GMT
What should be considered by RS is an assigned CS rep on this forum. The lack of payments issue did resolve and any panic stations was avoided as we shared our collective experiences. If you try to ring RS there are now some delays in getting through due to overload of staff.
Surely it is both cost effective and makes good business sense to use this forum, which has some gravitas, to get communication out more efficiently?
RS use the term "Expert lenders" do they not? Those on the forum are such and RS's weathervane fail or foul!
Come on RS, wake up and formalise a CS rep on the forum...........saving both you and us time and trouble. Luke M is senior enough and does the blog he would do! I will ask him.
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Post by westonkevRS on Nov 4, 2016 14:13:20 GMT
Luke M is senior enough and does the blog he would do! Luke will be very happy and surprised to know he has been promoted to a position of seniority.....
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Post by ruralres66 on Nov 4, 2016 15:22:29 GMT
I thought he was senior, I stand corrected, but he did inspire a certain confidence when I spoke with him in London at a talk! He does put his name to the blog though so is accorded a degree of responsibility, surely? It would be very useful to have a management hierarchy chart on the RS website like the US one for FC I think it was.
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Post by unknown on Nov 4, 2016 19:08:44 GMT
Welcome back Kevin!! Even if it is just a fleeting visit.
westonkev
Representative of RateSetter
*****
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Post by valueinvestor123 on Nov 4, 2016 22:12:27 GMT
Please note I am posting in a completely personal capacity here. Some of you may have noticed a similar near complete stoppage of my engagement with this forum and that didn't come from above but was simply because it was creating more negatives than positives. We've never spent the time analysing the tone of posts but to me it felt like hardly anything could be posted without it being challenged in some form or another, taken out of context, or pulled apart as some cynical ploy on AC's behalf. A large proportion of the actions taken by the platform were greeted with automatic and instant scepticism that then took huge effort to explain and turn around which was then even followed by direct personal accusations of us trying to silence criticism or stifle debate. As an experiment I decided to stop making that personal effort to post - it's not in my job description and has always been in a personal capacity as I care about the company I co-founded. The end result as far as I can tell, again without having conducted a detailed study, is that whilst overall engagement is hugely down it has been a proportionally greater fall in negative posts. Despite sentiment on this forum over the same period we've seen a large increase in on platform engagement and investment, partly within our existing user base but also through the work we do to attract new lenders through other channels. I want to engage with this forum, I've been a supporter from the start and even after this extended period of silence I'm firmly in the top 10 posters of all time, but the only evidence I have is that it's a lot of work to do properly yet ends up being counter productive. If new lenders come to this forum and find an undercurrent of negativity that the platform is constantly having to battle then that is neither the impression we want to be cultivating nor an accurate reflection of the way our lenders as a whole feel. I can only presume that other platforms have a similar experience given their similar trajectory in level of engagement. This is interesting and timely. From observation, I think there are two ways of using social media (forums included): promoting a company or offer customer support. The former is akin to how a pop star may use social media, trying to engage with their fan base for self-promotion: from experience, this usually ends in tears and not a good idea because fans will quickly see through bull£$% and quickly lose interest. However engaging with clients and addressing legitimate concerns and answer questions in a dispassionate manner will be of benefit to investors, on balance, and the company will only gain more trust this way. I actually just had a pretty bad experience with one of your colleagues on the AC board after I asked some questions and then offered my opinion which wasn't even criticism per se at first: the very first thing was the observation from your colleague (before addressing anything that I said) that I must have some hidden agenda for making these questions in the first place. I found it pretty shocking form. I know I also didn't handle it well afterwards but if one assumes bad intent before even engaging in conversation, it will never end well.
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Post by chris on Nov 5, 2016 7:17:34 GMT
Please note I am posting in a completely personal capacity here. Some of you may have noticed a similar near complete stoppage of my engagement with this forum and that didn't come from above but was simply because it was creating more negatives than positives. We've never spent the time analysing the tone of posts but to me it felt like hardly anything could be posted without it being challenged in some form or another, taken out of context, or pulled apart as some cynical ploy on AC's behalf. A large proportion of the actions taken by the platform were greeted with automatic and instant scepticism that then took huge effort to explain and turn around which was then even followed by direct personal accusations of us trying to silence criticism or stifle debate. As an experiment I decided to stop making that personal effort to post - it's not in my job description and has always been in a personal capacity as I care about the company I co-founded. The end result as far as I can tell, again without having conducted a detailed study, is that whilst overall engagement is hugely down it has been a proportionally greater fall in negative posts. Despite sentiment on this forum over the same period we've seen a large increase in on platform engagement and investment, partly within our existing user base but also through the work we do to attract new lenders through other channels. I want to engage with this forum, I've been a supporter from the start and even after this extended period of silence I'm firmly in the top 10 posters of all time, but the only evidence I have is that it's a lot of work to do properly yet ends up being counter productive. If new lenders come to this forum and find an undercurrent of negativity that the platform is constantly having to battle then that is neither the impression we want to be cultivating nor an accurate reflection of the way our lenders as a whole feel. I can only presume that other platforms have a similar experience given their similar trajectory in level of engagement. This is interesting and timely. From observation, I think there are two ways of using social media (forums included): promoting a company or offer customer support. The former is akin to how a pop star may use social media, trying to engage with their fan base for self-promotion: from experience, this usually ends in tears and not a good idea because fans will quickly see through bull£$% and quickly lose interest. However engaging with clients and addressing legitimate concerns and answer questions in a dispassionate manner will be of benefit to investors, on balance, and the company will only gain more trust this way. I actually just had a pretty bad experience with one of your colleagues on the AC board after I asked some questions and then offered my opinion which wasn't even criticism per se at first: the very first thing was the observation from your colleague (before addressing anything that I said) that I must have some hidden agenda for making these questions in the first place. I found it pretty shocking form. I know I also didn't handle it well afterwards but if one assumes bad intent before even engaging in conversation, it will never end well. When I first engaged with this forum it was for three main reasons. The most self serving was promotion of the platform to a wider audience. Secondly it gave me a direct connection to a portion of our user base via which I could understand how the platform was being used, how lenders wished to interact, solicit feedback and ideas on how we could improve, hear first hand how our customer services team were performing, etc. Finally it allowed me to offer first line support from someone with intimate knowledge of how every nook and cranny of the platform worked. Others in the business engaged for other reasons including the more altruistic ones like simply providing a space where a community like this could flourish. However there's an element of human nature where people try and justify their choices after they've been made, so when someone has decided to invest in platform X instead of AC sometimes they can seek to persuade others that that is the only logical choice. That, and other aspects of human nature, can end up creating an undercurrent of negativity even when the platform is performing well. We seem to be at the point now where no matter what we do someone somewhere will feel disenfranchised or think we're doing things incorrectly and will very vocally complain. Adding to that problem there have been those with bad intent both on and off this forum, from competitors posting trying to persuade others that we're up to no good through to disgruntled lenders organising themselves "against" us. No platform is perfect, we will all make mistakes or take missteps from time to time. Your money is at risk and there will be losses. Anyone who expects otherwise shouldn't be involving themselves in direct lending. With your specific complaints about the QAA if you read back through the thread I hope you can understand why suspicions were raised. You started off posting as someone not understanding the account or how it works but quickly morphed into someone directly criticising the fundamentals of the account and our risk modelling despite not understanding exactly what that entailed from our side. The QAA is designed as a very simple method of investing where lenders have a degree of liquidity in normal market conditions. There is a cash portion of the account, typically between 25% and 50% of the total invested although that both varies and is liable to reduce a little bit as the account grows in size. That provides the "instant" liquidity. We've thus far had well over £100m withdrawn from the account in less than 1 second primarily using that mechanism. When the account is full, something not too likely to happen again in the future, then there can also be a queue of funds waiting to get into the account that provides further liquidity. To maintain the cash portion of the account the QAA can also given priority on the open market when selling its holdings in the loans in which it has invested and there are a couple of other mechanisms in place for rapidly freeing up funds. The reason we say in normal market conditions is simply because none of the above is guaranteed to remain ahead of liquidity demands. It is improbable but feasible that all activity on the site freezes, no one is investing more money within the platform, no one is buying loan units, and people withdraw more cash from the QAA than has been held in reserve. Thus far we haven't come close to that happening but if it did then it is possible that the quick access to those funds is no longer provided. However each loan is still asset backed and there is an extensive provision fund to call upon as well as the option for the platform to bolster that provision fund as needed, so the chance for an actual crystalised loss should be non-zero but small. This is similar to RS and their resolution event - something that they would no doubt do all they can to avoid but remains a possibility so they have to make reference to it within their site. There are conditions where the QAA would not work as primarily advertised and whilst we will do all we can to avoid that happening it remains a possibility and we need to include phrases like "in normal market conditions" to make reference to that.
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Post by jackpease on Nov 5, 2016 8:27:24 GMT
I am looking aghast at the SS threads atm - massive amounts of negativity and endless demands for a comment which can never be satiated - and if they were would prompt a further bout of negativity and demands for answers. I think SS will be the next to decide how much engagement they have with this forum because as you have said previously, engagement worked in the past but now just seems to fan the flames of DM-style negativity. The character of this forum has changed - despite the best efforts of the mods who are now also a target for all the woes of the world - the really useful due diligence is being swamped by suspicion and mistrust - SS used to be the 'current darling' - Moneything is the current darling - as that gets overpopular and rates droop so people will turn on that platform too. Jack P
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Post by valueinvestor123 on Nov 5, 2016 8:31:53 GMT
This is interesting and timely. From observation, I think there are two ways of using social media (forums included): promoting a company or offer customer support. The former is akin to how a pop star may use social media, trying to engage with their fan base for self-promotion: from experience, this usually ends in tears and not a good idea because fans will quickly see through bull£$% and quickly lose interest. However engaging with clients and addressing legitimate concerns and answer questions in a dispassionate manner will be of benefit to investors, on balance, and the company will only gain more trust this way. I actually just had a pretty bad experience with one of your colleagues on the AC board after I asked some questions and then offered my opinion which wasn't even criticism per se at first: the very first thing was the observation from your colleague (before addressing anything that I said) that I must have some hidden agenda for making these questions in the first place. I found it pretty shocking form. I know I also didn't handle it well afterwards but if one assumes bad intent before even engaging in conversation, it will never end well. When I first engaged with this forum it was for three main reasons. The most self serving was promotion of the platform to a wider audience. Secondly it gave me a direct connection to a portion of our user base via which I could understand how the platform was being used, how lenders wished to interact, solicit feedback and ideas on how we could improve, hear first hand how our customer services team were performing, etc. Finally it allowed me to offer first line support from someone with intimate knowledge of how every nook and cranny of the platform worked. Others in the business engaged for other reasons including the more altruistic ones like simply providing a space where a community like this could flourish. However there's an element of human nature where people try and justify their choices after they've been made, so when someone has decided to invest in platform X instead of AC sometimes they can seek to persuade others that that is the only logical choice. That, and other aspects of human nature, can end up creating an undercurrent of negativity even when the platform is performing well. We seem to be at the point now where no matter what we do someone somewhere will feel disenfranchised or think we're doing things incorrectly and will very vocally complain. Adding to that problem there have been those with bad intent both on and off this forum, from competitors posting trying to persuade others that we're up to no good through to disgruntled lenders organising themselves "against" us. No platform is perfect, we will all make mistakes or take missteps from time to time. Your money is at risk and there will be losses. Anyone who expects otherwise shouldn't be involving themselves in direct lending. With your specific complaints about the QAA if you read back through the thread I hope you can understand why suspicions were raised. You started off posting as someone not understanding the account or how it works but quickly morphed into someone directly criticising the fundamentals of the account and our risk modelling despite not understanding exactly what that entailed from our side. The QAA is designed as a very simple method of investing where lenders have a degree of liquidity in normal market conditions. There is a cash portion of the account, typically between 25% and 50% of the total invested although that both varies and is liable to reduce a little bit as the account grows in size. That provides the "instant" liquidity. We've thus far had well over £100m withdrawn from the account in less than 1 second primarily using that mechanism. When the account is full, something not too likely to happen again in the future, then there can also be a queue of funds waiting to get into the account that provides further liquidity. To maintain the cash portion of the account the QAA can also given priority on the open market when selling its holdings in the loans in which it has invested and there are a couple of other mechanisms in place for rapidly freeing up funds. The reason we say in normal market conditions is simply because none of the above is guaranteed to remain ahead of liquidity demands. It is improbable but feasible that all activity on the site freezes, no one is investing more money within the platform, no one is buying loan units, and people withdraw more cash from the QAA than has been held in reserve. Thus far we haven't come close to that happening but if it did then it is possible that the quick access to those funds is no longer provided. However each loan is still asset backed and there is an extensive provision fund to call upon as well as the option for the platform to bolster that provision fund as needed, so the chance for an actual crystalised loss should be non-zero but small. This is similar to RS and their resolution event - something that they would no doubt do all they can to avoid but remains a possibility so they have to make reference to it within their site. There are conditions where the QAA would not work as primarily advertised and whilst we will do all we can to avoid that happening it remains a possibility and we need to include phrases like "in normal market conditions" to make reference to that. "However there's an element of human nature where people try and justify their choices after they've been made, so when someone has decided to invest in platform X instead of AC sometimes they can seek to persuade others that that is the only logical choice."That's called confirmation bias. On the other hand it may also be because a person is seeking disconfirmation: you made a choice, put a lot of money into a platform then discover there is another platform that may be more suitable to your needs, you then start criticising it in order to get other people to argue and present views why the platform may in fact be good for you in order to form an opinion. There can be many reasons. However there is nothing wrong with presenting criticism, in a non-offensive and constructive way!"With your specific complaints about the QAA if you read back through the thread I hope you can understand why suspicions were raised. You started off posting as someone not understanding the account or how it works but quickly morphed into someone directly criticising the fundamentals of the account and our risk modelling despite not understanding exactly what that entailed from our side."
Ok, I think it is a normal course of events when someone first doesn't understand anything about an account (which requires 69 thread pages to explain) then goes on to study it in more detail, find that it is extremely opaque in its nature and may not be suitable for what it is being marketed for (as a quasi cash account, with constant liquidity in specific market conditions: I changed this, from "normal" conditions, which I think is misleading). I have been accused of pretty much everything possible on those threads (including impersonating various people), except getting help in understanding the one thing I was asking information about: long term studies and data on SME loans and their default/loss rates for the last few recessions and how they correspond with the 0.32% loss assumptions made by AC models. Never mind. I don't want to transfer that thread over to here as people are fed up reading about it nor do I want to continue to criticise the QAA and its suitability as I know you spent tons of time on creating and improving it. (I finally read all the 69 pages: there was only ONE post that made any sense to me whatsoever: the one posted by a mod: " I understand why AC did it from a business perspective, but I don't like it from a lender perspective. I do wonder what the FCA will make of it, because I can see no functional difference between QAA and a bank account (ie borrow short lend long) bar the lack of FSCS cover, and that's basically regulator arb." (i.e. Emperor's clothes). Which is precisely the worry that I expressed and which was met with such suspicions. The only way that science and new innovation can make progress is when challenged ideas are met with open eyes. Religion, on the other hand, is responsible to control group-think and ensure people don't look for the truth (as one of its negatives). I don't wish these boards or peer2peer investments in general to become a religion, with company reps as their popes.
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Post by valueinvestor123 on Nov 5, 2016 8:55:52 GMT
"With your specific complaints about the QAA if you read back through the thread I hope you can understand why suspicions were raised. You started off posting as someone not understanding the account or how it works but quickly morphed into someone directly criticising the fundamentals of the account and our risk modelling despite not understanding exactly what that entailed from our side."
Actually I do need to address this: what were you or your colleague becoming suspicious about exactly? That I was posting on behalf of a rival company or something else? What was the exact reason for being suspicious? That's what they do in dictatorial countries: if you can't prove guilt for something, then accuse them of something completely unrelated to influence global sentiment of the public.
From Andrew's responses about the bits and pieces about the workings of the model used, it became fairly clear to me that it was more likely than not to be faulty and assumption used, detached from real world, long term scenarios, potentially locking unsuspecting investors into an account, wrongly labelled "quick access". This name should not be synonymous with anything to do with peer2peer!
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