Review of Assetz Capital (AC), Funding Circle (FC), and ReBS
Feb 8, 2015 10:22:49 GMT
ilmoro, sqh, and 2 more like this
Post by Deleted on Feb 8, 2015 10:22:49 GMT
Hi,
I have now been investing for about 1 month on those three platforms (Assetz Capital (AC), Funding Circle (FC), and Rebuilding Society (ReBS)), and can share my experience in P2P lending aimed at businesses.
Assetz Capital:
Pros:
* Nice website, clear, information well presented
* Clear on what security has been taken against each loan (all loans are secured against assets)
* Detailed statements can be exported in CSV/Excel
* No fees for buying or selling. No fees for lenders
* No losses since in business, all money has been recovered
* Detailed view on repayments per month, lateness etc
* A lot of targeted communication to investors, with some votes on options for troubled loans
* Interest is calculated/accrued based on duration of ownership of part (rather than interest payment date)
* Loan parts are not set to specific amounts (e.g. someone can buy £42 from someone selling £500). Basically, platform is trading amounts, not specific loan parts (unlike the other 2)
Cons:
* Lowest number of active loans available (77)
* Low activity on second market (people holding to their loan parts). Could take a long time (months?) to properly diversify an investment of a few thousand pounds. Could probably take a long time to sell some of the loan parts too
* No incentives for people to sell on second market (rate for buyer and seller is the same, no bonus/malus). Fixed rates per loan (buyer/seller don't set their own rates)
* Market matching logic/rules undisclosed (platform decides who gets what, unlike other two)
* Few new loans coming on board (1 per week?)
* Loading money takes longer than others (1 working day from time received on their account). Only bank transfer supported. No email notification when cash is loaded
* No "financial" tab to show table of profit and losses for applicant (as per other platforms)
* Most loans have little amortization, meaning that the borrower mainly pays interest during the loan, and most of the principal is repaid at the very end. This may increase the risk of default, or borrower having to secure another loan at the end of the current one
* The only platform of the three not to provide overall statistics on loans on its website: number of late payments, defaults etc.
Funding Circle:
Pros:
* Clean, clear website
* Can load cash quickly (debit card, instant), useful during week-ends!
* Active market for new loans and secondary market (given the size of platform)
* Can quickly invest a large amount across many loans/diversification
* Cashback on some new loans (regardless of investment amount)
* Quick view on borrower's finance (finance summary)
* Credit score graph on the borrower (with monthly trend)
* Showing clearly exposure/risk to one business on personal dashboard
* Most loans seem to have amortization
Cons:
* Most loans are unsecured, or only have personal security (which may be worth very little)
* When security is taken, no details provided (security on what?)
* Annual fee of 1%, deducted from interest paid
* Lower rates than other business platforms
* Some losses made, although forecast seems to decrease
Rebuilding Society:
Pros:
* Good interest rates available
* Good activity on the aftermarket
* Can invest a large amount quickly, and diversify across many loans
* Cash loaded fairly quickly (half a working day)
* All loans seem to have security, although details not provided clearly (particularly security on what assets)
* Clear "finance summary" tab/P&L view
* Most loans have amortization, meaning that the borrower has constant repayments during the loan duration (probably making it more predictable/less risky)
* According to the statistics available on the site, no losses made so far
Cons:
* Worst website of the three, looks amateur in several places. Same applies to automated emails (different templates, some variables left)
* Can't export most views/statements
* Interest is paid to whoever has the loan part at the date/time of interest payment (monthly), so timing of selling/purchasing parts can affect returns
* Lots of small amount parts, takes a while to buy parts on the aftermarket. Back button on browser does not work sometimes, when trying to go back to sorted lists
My own conclusion:
* Assetz Capital appears to have the best security. However, investing large amounts, with some good diversification (e.g. >100 loans), could take a long time (currently more than a year, based on new loans and aftermarket trades), and also possibly it could take a long time getting out of loans before their completion (so investment should be seen as long term/term of the loan)
* Funding Circle has by far the biggest marketplace, but most loans seem to have little security (particularly against specific assets), so diversification is key and should be easily done, given the number of loans, and is encouraged by FC (to spread investment on at least 100 loans). Best financial tools available to assess the borrower's credit risk
* Rebuilding Society requires more work for borrowers, but an active marketplace allowing for diversification and rapid investment (when paying a premium on existing loans). Best rates, with some security (although details are usually unknown)
Would welcome other views on recent experience!
S.
I have now been investing for about 1 month on those three platforms (Assetz Capital (AC), Funding Circle (FC), and Rebuilding Society (ReBS)), and can share my experience in P2P lending aimed at businesses.
Assetz Capital:
Pros:
* Nice website, clear, information well presented
* Clear on what security has been taken against each loan (all loans are secured against assets)
* Detailed statements can be exported in CSV/Excel
* No fees for buying or selling. No fees for lenders
* No losses since in business, all money has been recovered
* Detailed view on repayments per month, lateness etc
* A lot of targeted communication to investors, with some votes on options for troubled loans
* Interest is calculated/accrued based on duration of ownership of part (rather than interest payment date)
* Loan parts are not set to specific amounts (e.g. someone can buy £42 from someone selling £500). Basically, platform is trading amounts, not specific loan parts (unlike the other 2)
Cons:
* Lowest number of active loans available (77)
* Low activity on second market (people holding to their loan parts). Could take a long time (months?) to properly diversify an investment of a few thousand pounds. Could probably take a long time to sell some of the loan parts too
* No incentives for people to sell on second market (rate for buyer and seller is the same, no bonus/malus). Fixed rates per loan (buyer/seller don't set their own rates)
* Market matching logic/rules undisclosed (platform decides who gets what, unlike other two)
* Few new loans coming on board (1 per week?)
* Loading money takes longer than others (1 working day from time received on their account). Only bank transfer supported. No email notification when cash is loaded
* No "financial" tab to show table of profit and losses for applicant (as per other platforms)
* Most loans have little amortization, meaning that the borrower mainly pays interest during the loan, and most of the principal is repaid at the very end. This may increase the risk of default, or borrower having to secure another loan at the end of the current one
* The only platform of the three not to provide overall statistics on loans on its website: number of late payments, defaults etc.
Funding Circle:
Pros:
* Clean, clear website
* Can load cash quickly (debit card, instant), useful during week-ends!
* Active market for new loans and secondary market (given the size of platform)
* Can quickly invest a large amount across many loans/diversification
* Cashback on some new loans (regardless of investment amount)
* Quick view on borrower's finance (finance summary)
* Credit score graph on the borrower (with monthly trend)
* Showing clearly exposure/risk to one business on personal dashboard
* Most loans seem to have amortization
Cons:
* Most loans are unsecured, or only have personal security (which may be worth very little)
* When security is taken, no details provided (security on what?)
* Annual fee of 1%, deducted from interest paid
* Lower rates than other business platforms
* Some losses made, although forecast seems to decrease
Rebuilding Society:
Pros:
* Good interest rates available
* Good activity on the aftermarket
* Can invest a large amount quickly, and diversify across many loans
* Cash loaded fairly quickly (half a working day)
* All loans seem to have security, although details not provided clearly (particularly security on what assets)
* Clear "finance summary" tab/P&L view
* Most loans have amortization, meaning that the borrower has constant repayments during the loan duration (probably making it more predictable/less risky)
* According to the statistics available on the site, no losses made so far
Cons:
* Worst website of the three, looks amateur in several places. Same applies to automated emails (different templates, some variables left)
* Can't export most views/statements
* Interest is paid to whoever has the loan part at the date/time of interest payment (monthly), so timing of selling/purchasing parts can affect returns
* Lots of small amount parts, takes a while to buy parts on the aftermarket. Back button on browser does not work sometimes, when trying to go back to sorted lists
My own conclusion:
* Assetz Capital appears to have the best security. However, investing large amounts, with some good diversification (e.g. >100 loans), could take a long time (currently more than a year, based on new loans and aftermarket trades), and also possibly it could take a long time getting out of loans before their completion (so investment should be seen as long term/term of the loan)
* Funding Circle has by far the biggest marketplace, but most loans seem to have little security (particularly against specific assets), so diversification is key and should be easily done, given the number of loans, and is encouraged by FC (to spread investment on at least 100 loans). Best financial tools available to assess the borrower's credit risk
* Rebuilding Society requires more work for borrowers, but an active marketplace allowing for diversification and rapid investment (when paying a premium on existing loans). Best rates, with some security (although details are usually unknown)
Would welcome other views on recent experience!
S.
