Expected returns ?

If you factor in tax that would not be worth the risk

Without getting into an argument over valuations etc, with the Lendy model of retaining interest, you have a c.30% loss on day one so when you consider forced sale values, cash drag on collections costs, the fact that a lot of loans are not 12%, your figures with that type of default rate are optimistic, without considering the current number of defaults that, I am informed by posts on this forum, are nearly a third.

After a little over 3 years with Saving Stream / Lendy, my XIRR estimate ranges from 12.2% (valuing all parts at par, but ignoring all accrued & bonus interest) down to around 9.6% (if I ascribe zero value to defaulted and suspended parts). My best guess estimate is something around 11%, which is way higher than I ever assumed (my assumption was perhaps 8% net). This figure reflects the facts that:
a) I benefited from the "sunshine years", when most traffic on this forum was about getting bigger allocations and FFF strategies for bagging anything that appeared on the SM (very little about DD!!)
b) I've always been rather cautious about which loans to lean into and which to avoid, meaning I've dodged many of the bullets and have only small stakes in 3 or 4 "problem loans" (for which I blame myself entirely; I knew they were higher risk but continued to keep a toe in as I was too greedy to sell)
c) my total Lendy holding is down to about 70% of what it once was, good new loans having lagged behind repayments of older ones. That said, it's up 10-15% again in the last few months.

It's understandable that lenders who took the "Earn 12%, asset-secured with a provision fund" message at face value, and assumed there'd always be SM buyers for any loan part, are frustrated and venting at Lendy on here. Lendy don't do themselves any favours by continuing to imply that all in the garden is rosy. However, IMHO, the strongly negative bias to current forum traffic is as overdone as the strongly positive bias through most of 2014/15/16. The reality is that high-risk P2P lending eventually ALWAYS incurs losses, which individually can be ugly.

Pretty much all P2P platforms have gone through a honeymoon period where lender demand runs ahead of loan supply, where the loan book is too young to have yet incurred losses, and where platforms' overriding focus is on accelerating loan origination (both number and size). Almost always, this results in a rash of ill-advised loans that platforms (and their lenders) end up regretting ever taking on. It happened to AC, it happened to TC, it happened to FC and it's happened more recently to FS, Lendy, and MT (COL never even made it that far!).

Inevitably there's then a painful period whilst lenders learn the P2P "facts of life" and platforms learn the art of recovering defaults (and both come to realise that this process takes a VERY long time). Some platforms manage this better than others; AC's reputation has generally risen through proving their skills at long-term recovery. FC threw in the towel quickly and pulled the plug on asset-secured lending. For FS, Lendy, MT, etc. the jury is very much still out.

For what it's worth, I'm encouraged by Lendy's approach to recoveries to date. Whilst they put a superficial gloss on communications (and hide the smellier details), their strategic hires look sensible and their actions vis-a-vis recalcitrant borrowers appear robust and tenacious. They're going to have to dial in their ambitions for a while in terms of filling big new loans, and be creative in filling remaining tranches of existing ones, but their business model is pretty sound and I suspect they'll ride out the storm OK provided they carry on learning.

Similar figures for 3.5 years investment.

100% recovery of default loan capital = XIRR 12.29%
0% recovery of default loan capital = XIRR 10.83%

However, what may be spooking many people is the £36m on the default list and the potential for platform failure.

Platform failure leading to say 70% capital only recovery leaves me with XIRR 0.55%, so still not a total calamity.

However, I suspect that these calculations look a lot worse for those that started investing more recently.

Those who have been in Lendy for years (like me) have HAD very good returns.

I'm weighing up the future and ignoring the past and wondering if Lendy is attractive to continue investing in.

I would estimate future returns to be more like 5% and whilst it's decent, it's not worth the effort. Any thoughts ?

I'm all out of Lendy with no losses have been since July/August 2017. Mostly had 12% loans. Tried to limit any cash drag. If I did looks at returns the number would expect close to 12%.

I wouldn't expect those returns now.

Also see: p2pindependentforum.com/thread/11540