Post by justuslee on May 10, 2018 16:06:43 GMT
I am sure that it comes as no surprise to active lenders, that there is currently a risk-reward disconnect between ISA Money and Non-ISA money.
Our HNW lenders and IFA introduced lenders, have 2 interest rate expectations on their money.
In simple terms, this is roughly 2-3% differential yield expectation p.a. which is a discount flowing through to lower cost of borrowing and better quality borrowers who quite correctly can command lower interest rates creating a virtuous cycle.
ISA money is disrupting the traditional price of capital, making P2P ISA borrowing considerably more attractive than it was before. Traditional banks and balance sheet lenders are starting to feel the disruption, we as a platform have since formation, planned to attract these prime borrowers reducing the risk of capital loss for our growing lender base.
We do however currently have a dominance of ISA money flowing onto the platform and we are keen to continue to attract non-ISA capital.
We are seeking feedback from all lenders, market forces will dictate the gross interest rates payable by borrowers.
Our HNW lenders and IFA introduced lenders, have 2 interest rate expectations on their money.
In simple terms, this is roughly 2-3% differential yield expectation p.a. which is a discount flowing through to lower cost of borrowing and better quality borrowers who quite correctly can command lower interest rates creating a virtuous cycle.
ISA money is disrupting the traditional price of capital, making P2P ISA borrowing considerably more attractive than it was before. Traditional banks and balance sheet lenders are starting to feel the disruption, we as a platform have since formation, planned to attract these prime borrowers reducing the risk of capital loss for our growing lender base.
We do however currently have a dominance of ISA money flowing onto the platform and we are keen to continue to attract non-ISA capital.
We are seeking feedback from all lenders, market forces will dictate the gross interest rates payable by borrowers.
