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Post by dan1 on Dec 15, 2017 23:16:42 GMT
I've just come across the following paper by Canbry Research, dated March 2017: P2P lending platforms in the UK
I've not read it yet but it looks detailed (well, it has some nice graphics  ). Apologies if this has already been reported. |
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Mike
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Post by Mike on Dec 15, 2017 23:34:41 GMT
Broadly agreeable document, thanks for sharing.
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Post by eascogo on Dec 16, 2017 0:12:51 GMT
I've just come across the following paper by Canbry Research, dated March 2017: P2P lending platforms in the UK
I've not read it yet but it looks detailed (well, it has some nice graphics ). Apologies if this has already been reported. Wow, plenty of meat for analytical minds there (not me). Perhaps the more rewarding times for individual lenders lay in the past. A quick browse-through identifies the following: Most platforms are loss-making, some heavily so. Prospects for medium-term profit-making far from proven. Trends is for lower returns.
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jonah
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Post by jonah on Dec 16, 2017 22:06:06 GMT
Very sobering reading. My take away is that typical returns for p2p lenders by 2020 is going to be down to ~ 4% which doesn’t really compare favourably with long term equity returns. Agreed... and that is before the wave of platform closures which will happen when the equity investors realise most p2p platforms don’t make cash.
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Post by dan1 on Dec 16, 2017 22:10:05 GMT
The analysis breaks down the sector into 3 market segments: mass-market, specialist loans, and high-value investor segments. The report focuses on the mass-market segment with the other two segments covered in the second report, which I assume is available by contacting Canbry?
The conclusion is perhaps all you need to know...
Given the current competitive dynamics of the sector, it is most likely that platform lenders and not borrowers, will be the target of price increases, either through charging explicit fees or
through reducing returns to lenders.
Fundamentally, the sector needs to reach profitability and there's only so much that can be squeezed by economies of scale.
There are a couple of anomalies I've noted (I'm sure there are many more). LI has recently migrated from specialist loans to high-value investor, and FS should be listed under the specialist loans segment (I'm not sure if their original pawn business would have ever placed them so low on the target loan value - see Figure 8).
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