chris1200
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Post by chris1200 on May 6, 2020 15:21:13 GMT
... Also, as has been explained to you, these are different products with differing levels of liquidity. What is your evidence that anything untoward is going on in the name of maximisation of profit? If you have none, I suggest you avoid potentially defamatory remarks. It would certainly have been possible for Ratesetter, instead of reducing rates when there weren't enough lenders, to increase rates to attract more money in.
I would assume the main reason they chose not to do that was the negative effect on their margin, and perhaps foresight that the provision fund was going to go down the tubes and people would be angry to be attracted in by increased rates which were then halved two months later. This is a completely different point. @freddie123 appears to be alleging (as others have) that RS is deliberately processing the 1 Year and 5 Year queues more quickly because it gets a sale fee from these, but not Access. This is based on zero evidence. But, on your point, obviously RS weren't going to increase rates - that would have been mad. Edit: apologies, linked to wrong user before
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chris1200
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Post by chris1200 on May 6, 2020 15:55:59 GMT
This is a completely different point. james91 appears to be alleging (as others have) that RS is deliberately processing the 1 Year and 5 Year queues more quickly because it gets a sale fee from these, but not Access. This is based on zero evidence. But, on your point, obviously RS weren't going to increase rates - that would have been mad. RS could have maintained (or increased) rates and diverted some of it's fees to the provision fund, a bit of short term pain on RS profits would be worth it for the long term feasibility of the offering. Instead they chose to put all the strain on investors. A £10mil investment by RS into the PF could be worth £50mil to RS in extra fees over the next 5 years, instead they chose to go down the route where they are going to be struggling as a business. Errr... RateSetter has hardly ever made a profit. But sure, advocate measures to make them go bust and take us down with them just to placate your rage at yourself for not bothering to find out what you were investing in. Also, the interest we're missing out on is going into the provision fund. So we're not really having any net 'strain' put on us.
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Post by jochietoch on May 6, 2020 15:56:08 GMT
No, i don't see that. That's the same as looking at an investment fund which says on average it's returned 10% per year. It's quite a stretch to complain to the ombudsman when it doesn't return 10% next year. I agree it could be misleading if that's the only thing you read before investing, but there was much more material to read beyond just that. Quite. If you're going to put (I assume) thousands of pounds of your money somewhere, you really do have at least some responsibility to find out what you're investing in - especially when that information is freely accessible on the website you're investing through. The idea that you can blame RS for you misunderstanding a particular statement (which in no way says what you argued before it says) and not bothering to read anything else on the website is ludicrous. Personally I agree with that "buyer beware" sentiment to a large extent, but it's not quite the standard that applies to consumer finance. While the statement that was quoted does indeed not promise 24h access when read carefully, to me it definitely reads as if it was crafted to give that impression without actually saying it. "Legacy finance" banks would not/did not get away with that kind of statement aimed at a retail audience - see also PPI mis-selling where it was found the banks should have protected people against themselves.
I have definitely occasionally raised an eyebrow when I saw how several P2P platforms (including RS) advertised on the Tube, apparently trying to look like a savings account to people who don't look too carefully. Which I think does open them up to mis-selling claims from the public, but time will tell. They are unlikely to be as attractive targets for litigation as the banks with their deep pockets. But I do think so far part of P2P's former success was that the FCA has not been applying the same standards to them as it applies to the banks, even though they have been fishing in the same pond.
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johnt
Investing in Ratesetter, Zopa and Assetz Capital since 2013
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Post by johnt on May 6, 2020 15:58:52 GMT
It would certainly have been possible for Ratesetter, instead of reducing rates when there weren't enough lenders, to increase rates to attract more money in.
I would assume the main reason they chose not to do that was the negative effect on their margin, and perhaps foresight that the provision fund was going to go down the tubes and people would be angry to be attracted in by increased rates which were then halved two months later. This is a completely different point. james91 appears to be alleging (as others have) that RS is deliberately processing the 1 Year and 5 Year queues more quickly because it gets a sale fee from these, but not Access. This is based on zero evidence. But, on your point, obviously RS weren't going to increase rates - that would have been mad. They might not have increased their rates but they did for a short period in the middle of March offer some attractive cashback promotions whereby the more you invested, the more cashback you got: a £50 bonus if your invested balance increases by between £5,000 and £9,999.99 a £100 bonus if your invested balance increases by between £10,000 and £19,999.99 a £200 bonus if your invested balance increases by between £20,000 and £49,999.99 a £500 bonus if your invested balance increases by £50,000 or more This promotion however rang alarm bells in my head (along with the health of the PF only going in one direction) and I promptly made a RYI. I imagine Ratesetter saw the huge number of RYI requests during this period so removed the promotion as it was having the reverse effect than they intended.
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chris1200
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Post by chris1200 on May 6, 2020 16:02:07 GMT
Quite. If you're going to put (I assume) thousands of pounds of your money somewhere, you really do have at least some responsibility to find out what you're investing in - especially when that information is freely accessible on the website you're investing through. The idea that you can blame RS for you misunderstanding a particular statement (which in no way says what you argued before it says) and not bothering to read anything else on the website is ludicrous. Personally I agree with that "buyer beware" sentiment to a large extent, but it's not quite the standard that applies to consumer finance. While the statement that was quoted does indeed not promise 24h access when read carefully, to me it definitely reads as if it was crafted to give that impression without actually saying it. "Legacy finance" banks would not/did not get away with that kind of statement aimed at a retail audience - see also PPI mis-selling where it was found the banks should have protected people against themselves.
I have definitely occasionally raised an eyebrow when I saw how several P2P platforms (including RS) advertised on the Tube, apparently trying to look like a savings account to people who don't look too carefully. Which I think does open them up to mis-selling claims from the public, but time will tell. They are unlikely to be as attractive targets for litigation as the banks with their deep pockets. But I do think so far part of P2P's former success was that the FCA has not been applying the same standards to them as it applies to the banks, even though they have been fishing in the same pond.
Which is why I said "at least some" responsibility, rather than absolute or total responsibility. I definitely didn't suggest a caveat emptor logic should be applied to retail P2P offerings. That statement about 24 hours didn't exist on its own (plenty of other warnings about liquidity are there too) and was relevant information to provide for investors to understand that, while liquidity was required, in normal times this was the sort of length of time to expect. Besides, when you're asked to tick a box saying "do you agree with these terms?", you really should actually be reading those terms when it concerns a load of your money! It's entirely foolish not to. I don't think time will tell on this. This has been a previous issue which the FCA cracked down on as part of awarding permission to operate (which is why 'Saving Stream' became 'Lendy'). I'm not going to get into a legal debate, but if you think "the FCA has not been applying the same standards", that's a different argument. RS only have to follow the regulations that are set and be held to these standards, not invent their own ones or be held to your or someone else's guess at what the rules should be.
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chris1200
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Post by chris1200 on May 6, 2020 16:17:30 GMT
The tick for those terms that we all did 5+ years ago and have changed considerably since. I'm looking forward to the day where financial institutions have to get acceptance to changes to terms like we do in other industries, rather than the current farce of send an email that you may or may not receive and count that as acceptance.This isn't the law. You do have to approve them. If you think there was a time when you weren't able to, do let us know the specific case and why you weren't able to exit the platform accordingly. I personally have no financial position with RateSetter, so comments about rage are unjust chris1200 _ Then what on earth were you going to complain to the Ombudsman about?
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Post by jochietoch on May 6, 2020 16:42:14 GMT
Which is why I said "at least some" responsibility, rather than absolute or total responsibility. I definitely didn't suggest a caveat emptor logic should be applied to retail P2P offerings. That statement about 24 hours didn't exist on its own (plenty of other warnings about liquidity are there too) and was relevant information to provide for investors to understand that, while liquidity was required, in normal times this was the sort of length of time to expect. Besides, when you're asked to tick a box saying "do you agree with these terms?", you really should actually be reading those terms when it concerns a load of your money! It's entirely foolish not to. Yes, fair enough. My point just being that if you're on the other side, an you bury the bad news in small print on the side of reams of paper, the argument "you could have known, it's in the terms" becomes a tad dishonest. I think we agree both sides have a responsibility here. I don't think time will tell on this. This has been a previous issue which the FCA cracked down on as part of awarding permission to operate (which is why 'Saving Stream' became 'Lendy'). I'm not going to get into a legal debate, but if you think "the FCA has not been applying the same standards", that's a different argument. RS only have to follow the regulations that are set and be held to these standards, not invent their own ones or be held to your or someone else's guess at what the rules should be. Here it's just that this is not so much about clearly defined regulations, but also about more vaguely defined standards on things like "Integrity" and "Customers interests" that leave open a wide range for interpretation. So you can pay your lawyer to come up with a clever scheme that keeps you exactly at the right side of regulations - with PPI the banks clearly thought they were - and then be deemed to have fallen foul of the principles later on, even if the FCA didn't enforce it or tell you off at the time. The idea being that as a financial institution you shouldn't try to be super clever in a dishonest way when dealing with retail customers, even if clever-and-a-bit-dishonest is your lifeblood when dealing with counterparties on the markets.
So they are held to the rules that were set, as well as to upholding a standard of integrity that's open to interpretation.
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chris1200
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Post by chris1200 on May 6, 2020 16:53:35 GMT
Yes, fair enough. My point just being that if you're on the other side, an you bury the bad news in small print on the side of reams of paper, the argument "you could have known, it's in the terms" becomes a tad dishonest. I think we agree both sides have a responsibility here. Sounds like we broadly agree here, I just think this has been highlighted pretty clearly rather than buried in small print. Here it's just that this is not so much about clearly defined regulations, but also about more vaguely defined standards on things like "Integrity" and "Customers interests" that leave open a wide range for interpretation. So you can pay your lawyer to come up with a clever scheme that keeps you exactly at the right side of regulations - with PPI the banks clearly thought they were - and then be deemed to have fallen foul of the principles later on, even if the FCA didn't enforce it or tell you off at the time. The idea being that as a financial institution you shouldn't try to be super clever in a dishonest way when dealing with retail customers, even if clever-and-a-bit-dishonest is your lifeblood when dealing with counterparties on the markets.
So they are held to the rules that were set, as well as to upholding a standard of integrity that's open to interpretation. My point was more that this is something the FCA specifically looked into in great deal as part of the permission granting process and set platforms specific measures they had to comply with in relation to it to gain permission. Of course there is always room for interpretation in the law and we can't be certain what might happen in the future, but I think you'd have a very strong argument that you were acting on the FCA's specific approval. PPI is a very different matter in that regard.
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chris1200
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Post by chris1200 on May 6, 2020 16:55:20 GMT
Then what on earth were you going to complain to the Ombudsman about? Non compliance of COBS 10.2.9 G Clearly I meant that you need to show some harm to make a complaint. But you knew that, I'm sure. That's it for me feeding this troll.
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Post by RateSetter on May 6, 2020 19:15:10 GMT
Good evening everyone. Today we have delivered £1.7m. Full update below, which can also be found on our website here.
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chris1200
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Post by chris1200 on May 6, 2020 19:59:37 GMT
Good evening everyone. Today we have delivered £1.7m. Full update below, which can also be found on our website here. Wow great stuff, guys! Keep this up and we'll all be back soon enough
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Post by jaycee on May 6, 2020 21:57:43 GMT
It would certainly have been possible for Ratesetter, instead of reducing rates when there weren't enough lenders, to increase rates to attract more money in.
I would assume the main reason they chose not to do that was the negative effect on their margin, and perhaps foresight that the provision fund was going to go down the tubes and people would be angry to be attracted in by increased rates which were then halved two months later. This is a completely different point. @freddie123 appears to be alleging (as others have) that RS is deliberately processing the 1 Year and 5 Year queues more quickly because it gets a sale fee from these, but not Access. This is based on zero evidence. But, on your point, obviously RS weren't going to increase rates - that would have been mad. Edit: apologies, linked to wrong user before I don't regard prices increasing when demand outstrips supply as inherently "mad".
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chris1200
Member of DD Central
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Post by chris1200 on May 7, 2020 7:35:45 GMT
This is a completely different point. @freddie123 appears to be alleging (as others have) that RS is deliberately processing the 1 Year and 5 Year queues more quickly because it gets a sale fee from these, but not Access. This is based on zero evidence. But, on your point, obviously RS weren't going to increase rates - that would have been mad. Edit: apologies, linked to wrong user before I don't regard prices increasing when demand outstrips supply as inherently "mad". Yes, when interest rates have just been lowered to all-time lows, whacking them up for investors at RS just as they’re struggling and putting the final nail in the coffin of a business that’s barely ever made a profit would be eminently sensible.
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Post by jaycee on May 7, 2020 9:11:02 GMT
I don't regard prices increasing when demand outstrips supply as inherently "mad". Yes, when interest rates have just been lowered to all-time lows, whacking them up for investors at RS just as they’re struggling and putting the final nail in the coffin of a business that’s barely ever made a profit would be eminently sensible. Central Bank interest rates are not directly linked to commercial interest rates.
Borrowers around the world are facing higher interest rates as lenders become more nervous - average rates paid have gone from 1% above benchmark to 3.5% above benchmark, since January.
No reason to expect Ratesetter would be immune from the laws of supply and demand. Same thing happened in the last crash.
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Post by Badly Drawn Stickman on May 7, 2020 9:17:36 GMT
Yes, when interest rates have just been lowered to all-time lows, whacking them up for investors at RS just as they’re struggling and putting the final nail in the coffin of a business that’s barely ever made a profit would be eminently sensible. Central Bank interest rates are not directly linked to commercial interest rates.
Borrowers around the world are facing higher interest rates as lenders become more nervous - average rates paid have gone from 1% above benchmark to 3.5% above benchmark, since January.
graph removed
No reason to expect Ratesetter would be immune from the laws of supply and demand. Same thing happened in the last crash.
Is there not a complicating factor now, that the Government (or more accurately indirectly us) is flooding the market with cheap easily accessible loans. Arguably that would seriously disadvantage RS in the market place for some loan types currently.
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