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Post by RateSetter on Apr 8, 2020 15:46:44 GMT
Good afternoon everyone. We have just posted the following RateSetter Notice:
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Post by BrianC on Apr 8, 2020 16:17:46 GMT
Will this money be used to speed up withdrawals?
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alanh
Posts: 556
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Post by alanh on Apr 8, 2020 16:27:31 GMT
Will this money be used to speed up withdrawals? No. Its part of the provision fund - a completely separate thing.
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ceejay
Posts: 971 
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Post by ceejay on Apr 8, 2020 16:27:37 GMT
Will this money be used to speed up withdrawals? Looking at what's happening in the world right now, I'd say that the Provision Fund is, or very soon will be, under huge pressure as borrowers simply stop paying. So the chances of anything being released as surplus from the PF are ... slim. My interpretation is that this is one of many levers that RS are frantically pulling in an attempt to avoid running headlong into the buffers. I have no idea whether they will succeed in this, although of course I hope they do.
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robski
Member of DD Central
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Post by robski on Apr 8, 2020 17:34:38 GMT
Why would the PF pay out a surplus, if it was vastly higher than needed the likely response is to lower the premium being paid into it
either to give more to RS or lower charges against lenders to drum up more business
Also this has happened before, probably roughly annually?
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agent69
Member of DD Central
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Post by agent69 on Apr 8, 2020 17:36:37 GMT
So RS have recovered £4.65m from 2 defaulting loans.
Does anyone know how much cash these two borrowers were originally given (I'm assuming a lot more than £4.65m)?
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robski
Member of DD Central
Posts: 772
Likes: 462
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Post by robski on Apr 8, 2020 17:41:21 GMT
So RS have recovered £4.65m from 2 defaulting loans.
Does anyone know how much cash these two borrowers were originally given (I'm assuming a lot more than £4.65m)? I read it as 2 sales, of default loan book s as opposed to 2 defaulted loans personally
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coogaruk
Hello everyone! Anyone remember me?
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Post by coogaruk on Apr 8, 2020 18:08:50 GMT
Whilst I take this as welcoming news it's likely to be a drop in the ocean so my own lending will remain under review. Definitely a sensible step in the right direction though.
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Post by mellbreak on Apr 8, 2020 18:59:17 GMT
It would be interesting to know how many loans were sold, and what percentage of their value the £4.65m represents.
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Post by bikeman on Apr 8, 2020 19:30:08 GMT
Will this money be used to speed up withdrawals? Looking at what's happening in the world right now, I'd say that the Provision Fund is, or very soon will be, under huge pressure as borrowers simply stop paying. So the chances of anything being released as surplus from the PF are ... slim. My interpretation is that this is one of many levers that RS are frantically pulling in an attempt to avoid running headlong into the buffers. I have no idea whether they will succeed in this, although of course I hope they do. The amount of money the government has put into the economy to protect jobs is nothing short of remarkable. This will be all over in a few months with the majority getting a reasonable income and their jobs protected. Sure there will be defaults but with this provision I think the level of defaults could be grossly over estimated. I think this scaremongering doesn't help and those that are cashing in potentially going to cause these platforms big problems. I'd like to see withdrawals frozen for 3 months like has been done at Growth street.
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ceejay
Posts: 971
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Post by ceejay on Apr 8, 2020 19:40:11 GMT
Looking at what's happening in the world right now, I'd say that the Provision Fund is, or very soon will be, under huge pressure as borrowers simply stop paying. So the chances of anything being released as surplus from the PF are ... slim. My interpretation is that this is one of many levers that RS are frantically pulling in an attempt to avoid running headlong into the buffers. I have no idea whether they will succeed in this, although of course I hope they do. The amount of money the government has put into the economy to protect jobs is nothing short of remarkable. This will be all over in a few months with the majority getting a reasonable income and their jobs protected. Sure there will be defaults but with this provision I think the level of defaults could be grossly over estimated. I think this scaremongering doesn't help and those that are cashing in potentially going to cause these platforms big problems. I'd like to see withdrawals frozen for 3 months like has been done at Growth street. Interesting that you read my post as "scaremongering". I think of myself as cautiously optimistic, certainly in the long run. I think it only realistic to note that a significant proportion of RS's borrowers are simply going to stop paying, whether officially sanctioned or not: and, if RS stay in their standard operating model and cover all missed payments from the PF, then the PF is going to be very stressed - and, as noted above, this PF top-up although very welcome won't make a huge difference on its own. Which is why we will I think see more levers pulled - such as the withdrawal freeze that you suggest. (Perhaps just a freeze on RYIs, rather than the full GS shutters-down?).
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Post by bikeman on Apr 8, 2020 20:42:13 GMT
The amount of money the government has put into the economy to protect jobs is nothing short of remarkable. This will be all over in a few months with the majority getting a reasonable income and their jobs protected. Sure there will be defaults but with this provision I think the level of defaults could be grossly over estimated. I think this scaremongering doesn't help and those that are cashing in potentially going to cause these platforms big problems. I'd like to see withdrawals frozen for 3 months like has been done at Growth street. Interesting that you read my post as "scaremongering". I think of myself as cautiously optimistic, certainly in the long run. I think it only realistic to note that a significant proportion of RS's borrowers are simply going to stop paying, whether officially sanctioned or not: and, if RS stay in their standard operating model and cover all missed payments from the PF, then the PF is going to be very stressed - and, as noted above, this PF top-up although very welcome won't make a huge difference on its own. Which is why we will I think see more levers pulled - such as the withdrawal freeze that you suggest. (Perhaps just a freeze on RYIs, rather than the full GS shutters-down?). I don't agree - most borrowers have retained some level of income and so can pay something. I'm of the opinion that most will be unwilling to default when it could all be over in a couple of months. Yes the PF will come under stress but if we can believe what's happened in China it is possible that this can be bought under control in a month or two.
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ceejay
Posts: 971
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Post by ceejay on Apr 8, 2020 22:53:18 GMT
... it is possible that this can be bought under control in a month or two. Wow. That is optimistic. Try this: www.wto.org/english/news_e/pres20_e/pr855_e.htm "World trade is expected to fall by between 13% and 32% in 2020 as the COVID 19 pandemic disrupts normal economic activity and life around the world."
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Post by cinereus on Apr 8, 2020 23:16:30 GMT
Not optimistic. Delusional.
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Post by bikeman on Apr 9, 2020 12:24:31 GMT
... it is possible that this can be bought under control in a month or two. Wow. That is optimistic. Try this: www.wto.org/english/news_e/pres20_e/pr855_e.htm "World trade is expected to fall by between 13% and 32% in 2020 as the COVID 19 pandemic disrupts normal economic activity and life around the world." Firstly China claims to have bought this under control. Secondly, I'm referring to the UK bringing this under control or more importantly allowing people back to work, what happens in the rest of the world is not so relevant to RS. Many of the businesses/people RS lend to are not going to default if they are helped through this with deferred payments and have a job to go back to. These are not payday loans for the unemployed.
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