Sale queue: how does it work and how can it be FCA approved?

Hey you looked at my file:-) Didn't think anyone was interested in this sale queue thing...


Thanks for the challenge, and I'd love to be wrong so I could be a little less cross which is bad for my blood pressure...

In my opinion, what is untoward is:

• Calling it a "queue" when it does not behave as one (not first-come-first-served like cuddly toys on a conveyor belt)
• Lack of transparency about how it works (what forces are acting on these loans? Why do some go faster than others?)
• No recognition from Lendy that this a failure of duty of care. If they said something like "we run a thing to feed the secondary market and we use it to keep things as fluid as possible but in slow times this can result in some assets getting stuck while others whizz through" and explained they had to do that as part of their effort to keep the platform afloat, I could accept that. But they don't. If they re-named it to "Lendy-managed holding pattern" I could live with that. But they haven't

Well, that bit for starters, I was guessing that there was one "sale queue" for all assets being listed for sale.

Also, why have a queue at all? Why not just list assets for sale on the secondary market?

Also, why should performance on the marketplace have any bearing on being listed on the marketplace? Would you not prefer to simply let your assets be listed for sale and then let the supply/demand forces of the market decide if and when your asset is bought?

Nice chart. Technically one has not "sold out". Once it made it to the front of the queue and onto the secondary marketplace it sold fairly quickly but it is currently stuck (been there for a week now) at 86.4% sold. Keeping fingers and toes very crossed:-)

Your question assumes that everyone knows what a queue is (why you might think there was only one queue...)

The "sale queue" is an entirely arbitrary concept that never needed explaining until a lot of assets got stuck in it.

What is it? 

The chart you created could just as easily show the three loans on the secondary marketplace, selling bit by bit until they were completely sold.

What value or use or function does the sale queue provide?

I've sold stuff at car boots, on ebay, door-to-door, on Zopa and even on the stock market. You put your stuff for sale, then wait until somebody buys it. THAT I understand.

The sale queue is like the overflow car-par across the street in front of the car boot sale. You can't open your trunk and get started selling until you're inside the approved area... I can see why you might need an overflow car park in real life, but what possible purpose could it add to a digital marketplace?

It feels like everyone else is going "hey, what's the problem" and I'm just being very dense so maybe I should leave it there...

There is a sell queue because there are more people looking to sell than buying. And as you can only sell loan parts at par the only thing to fairly distinguish between sellers is whoever listed their loan parts first gets to sell first when a buyer shows up,especially as lendy don't pay interest on loan parts in the sell queue. How would you propose to do things differently and fairly? The only alternative is allowing sales at premiums and discounts but there are cons to this method, too.

Is that still the case?

I'm pretty sure that another poster who tracks these things had suggested evidence that the 'dumping' had stopped.  The chart of the DFL019 _ which has oodles of new tranches on a regular basis _ suggests that observation is accurate.