Late Payments and Payment Shortfalls

I am personally more concerned about the large suspended loans totaling a few million (especially those which are covered by the Green Energy Accounts which could result in either a big payout from the provision fund or people losing a substantial % of their investment if the recovery rate is low). I am keeping a very close eye on how the recovery of these loans proceeds and will act accordingly.

I personally think they are one of the better P2P platforms out there and I have recently increased my holding. The key thing for me is not if the borrower defaults but if AC can make a reasonable recovery of the principal lent

angrysaveruk That is our position too. We are categorically an alternative (to high street banks) lender and taking an increased default risk is absolutely how we generate lender coupons of around 8% gross and borrower rates of c 9% versus high street banks lending at c 3-4%. We instead focus on minimising losses if a default occurs and we have a robust but considered recovery process. High street banks are here for the ‘foundation’ capital for the country’s SME businesses but have pulled out around £35bn in just the last few years and really moved away from funding higher risk (of default) lending which unfortunately where many of the entrepreneurial and growth / employment generating businesses are. Alternative finance is the ‘growth’ capital that supports GDP growth and it has more noise than simplistic lending behind the 1% savings accounts at banks. We employ a growing team of highly experienced credit professionals and independent AltFiData.com market data analysis shows our net of losses returns of c25% cumulative over the last 3 years which is clearly attractive to many people.

We now focus solely on property security backed loans and have also been tightening our defaulted loan status triggers which will absolutely mean more loans have a defaulted status than may have had before (and certainly more aggressively than many other platforms) but also this may mean some come back to normal trading from a default status if the borrowers rectify matters (which is not common elsewhere).

The yield that we generate for investors has all of this factored in and if you aren’t comfortable with defaults and our recovery process and skill then perhaps p2p isn’t for you or one of the simpler access accounts may be preferable. Nonetheless we believe that P2P has a transparency and return that is well worth considering as part of a balanced portfolio and we will continue to support retail investors to the level of their demand before introducing institutional capital.

I hope this helps and thank you for your support for what is now coming to five years of successful trading.

Ok, having asked the question regarding late payments we do have a human factor in this at present and it has led to some interest payment delays of a few days in some cases in the recent couple of weeks for which we apologise - Easter hasn’t helped plus some other matters to address. We have approaching 100 staff now and some new hires are in the finance team that manages this aspect - however some don’t arrive till a couple of weeks’ time. Expect much faster service then and also more automation on payments of interest shortly also.

FWIW, I started a thread about the delays to withheld interest payments back in September 2017. 7 months later, no noticeable change. Someone else may post about it again in another 7 months, but hopefully my sell-out will have finished by then.

Regarding 227.

Option B was to ask the Borrower for an alternative proposal. I took the initial offer to be a negotiating position and did not expect it to be taken seriously, neither did I expect another 12.5% interest to be accrued. What I did expect was that lenders would reject the proposal and something a little more rewarding to be offered.  The result therefore came as a surprise, and I doubt it will be repeated in 6 months time.