alanh
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Post by alanh on Mar 10, 2020 10:02:36 GMT
Proportion of cash held by access accounts is now less than 2.5% or in real terms <£5m in cash, if my calculations are correct. AC have boosted the refer a friend scheme and offered an additional 1% cashback for new investments held for a year. I'm struggling to think of the remaining levers that can stem the recent trend without significant cost to AC. At least it's not long to wait until the new tax year which must surely bring some fresh investment. Thank you for the important insight. 2.5% is a very low ratio. Despite what these P2P platforms will spin, we live in volatile times, as witnessed in today's carnage on the equity markets, and such a tiny buffer ratio is not very reassuring at all. Thoughts? Look at bg's graph above. This is exactly what happened at the end of the last tax year. Its a seasonal trend.
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sl75
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Post by sl75 on Mar 10, 2020 21:48:40 GMT
Proportion of cash held by access accounts is now less than 2.5% or in real terms <£5m in cash, if my calculations are correct. AC have boosted the refer a friend scheme and offered an additional 1% cashback for new investments held for a year. I'm struggling to think of the remaining levers that can stem the recent trend without significant cost to AC. At least it's not long to wait until the new tax year which must surely bring some fresh investment. A significant chunk of the reduction in cash held by the access accounts is because during that period AC have been lending new money out faster than existing loans are repaying, to the tune of around £8M of newly-lent money from the access accounts in excess of any repayments and/or sales from the access accounts.
Another lever they've pulled before when running short of Access Account funds is to make more use of their third party underwriting panel. The main downside of this from AC's perspective is that it tends to self-perpetuate - the third party underwriters sell large chunks of their loans (often at a discount, giving away part of their underwriting fee in exchange for being able to recycle the cash faster), which leaves less available retail money in the MLA to invest in new loans, or to buy the Access Accounts' cast-offs, and thus increases the need for third-party underwriters.
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sqh
Member of DD Central
Before P2P, savers put a guinea in a piggy bank, now they smash the banks to become guinea pigs.
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Post by sqh on Mar 22, 2020 14:18:50 GMT
I'd like to see AC introduce an 180 day access account at say 5.8%, with the alternative of suffering a one-off 1% from all current access account holdings to bolster the provision fund. I think lenders would switch to a 180 day account rather than suffer a 1% hit. Lets face it, it will be a slow process releasing lender funds from the QAA otherwise.
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sqh
Member of DD Central
Before P2P, savers put a guinea in a piggy bank, now they smash the banks to become guinea pigs.
Posts: 1,428
Likes: 1,212
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Post by sqh on Mar 22, 2020 16:42:30 GMT
Deees I agree with everything your saying. On reflection, AC need to take a blanket 2% of all access account money now, reduce the interest on QAA, 30day and 90 day by 1%, and introduce a 180 day account paying 5%.
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