locutus
Member of DD Central
Posts: 1,059 
Likes: 1,622
|
Post by locutus on Aug 2, 2015 21:10:09 GMT
I know that when interest payments are credited, a lot of people don't withdraw their money and instead wait for the next deal to come up so they can invest. I am one such person. I presume this money is held in an interest bearing client account and I was wondering what happened to the interest. Across the portfolio of investors, this must surely be mounting up and I would like to suggest that this money (the money held on the platform for SS investors but not yet lent out) is added to the Provision Fund where it can continue to compound and make SS an even safer platform for investors. Over the years this will surely add up and become a differentiator that other platforms will envy.
|
|
ilmoro
Member of DD Central
'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
Posts: 11,321
Likes: 11,527
|
Post by ilmoro on Aug 2, 2015 21:18:31 GMT
I know that interest paymentss are credited, a lot of people don't withdraw their money and instead wait f the next deal to come up so they can invest. I am one such person. I presume this money is held in an interest bearing client account and I was wondering what happened to the interest. Across the portfolio of investors, this must surely be mounting up and I would like to suggest that this money (the money held on the platform for SS investors but not yet lent out) is added to the Provision Fund where it can continue to compound and make SS an even safer platform for investors. Over the years this will surely add up and become a differentiator that other platforms will envy. I would be very surprised if the client account pays interest. I vaguely remember a query about this relating to another platform where the response was no interest was earnt on the client account. Cant see SS being any different. Nice idea. Also why leave money on the platform earning no money when it can be instantly credited. I dont leave any money on SS, MT, & on small sums on FS for that pop up mini loan that isnt trailed. AC gets churned. FC is the only one where I leave any money & even thats only short term
|
|
locutus
Member of DD Central
Posts: 1,059
Likes: 1,622
|
Post by locutus on Aug 2, 2015 21:23:46 GMT
I know that interest paymentss are credited, a lot of people don't withdraw their money and instead wait for the next deal to come up so they can invest. I am one such person. I presume this money is held in an interest bearing client account and I was wondering what happened to the interest. Across the portfolio of investors, this must surely be mounting up and I would like to suggest that this money (the money held on the platform for SS investors but not yet lent out) is added to the Provision Fund where it can continue to compound and make SS an even safer platform for investors. Over the years this will surely add up and become a differentiator that other platforms will envy. I would be very surprised if the client account pays interest. I vaguely remember a query about this relating to another platform where the response was no interest was earnt on the client account. Cant see SS being any different. Nice idea. Loads of client accounts pay interest. If they have one that isn't, they need to switch pronto.
|
|
|
|
Post by pepperpot on Aug 2, 2015 21:37:48 GMT
In any case the PF is set to 2% of outstanding loans, so unless it's rules are changed it isn't going to get 'added to' as suggested.
As I see it, the PF is just part of SS' profit that is set aside until a the deal completes when it then becomes official profit and can be pocketed. (and spent on a ski trip)
|
|
spockie
Member of DD Central
Posts: 299 
Likes: 84
|
Post by spockie on Aug 3, 2015 6:44:17 GMT
I would be very surprised if the client account pays interest. I vaguely remember a query about this relating to another platform where the response was no interest was earnt on the client account. Cant see SS being any different. Nice idea. Loads of client accounts pay interest. If they have one that isn't, they need to switch pronto. The reply for another company was that the client account is not allowed to be interest paying. None of the P2P companies I invest with has an interest bearing client account. Which ones do then?
|
|
locutus
Member of DD Central
Posts: 1,059
Likes: 1,622
|
Post by locutus on Aug 3, 2015 7:11:47 GMT
Loads of client accounts pay interest. If they have one that isn't, they need to switch pronto. The reply for another company was that the client account is not allowed to be interest paying. None of the P2P companies I invest with has an interest bearing client account. Which ones do then? Loads here moneyfacts.co.uk/business/client-account/Some of them are notice accounts but I'm sure there are plenty of instant access ones. A combination of the two could be used to maximise interest.
|
|
spockie
Member of DD Central
Posts: 299
Likes: 84
|
Post by spockie on Aug 3, 2015 7:14:24 GMT
The reply for another company was that the client account is not allowed to be interest paying. None of the P2P companies I invest with has an interest bearing client account. Which ones do then? Loads here moneyfacts.co.uk/business/client-account/Some of them are notice accounts but I'm sure there are plenty of instant access ones. A combination of the two could be used to maximise interest. Sorry, I meant which P2P companies use an interest bearing client account, as my understanding from an AC reply was that they are not allowed to.
|
|
webwiz
Posts: 1,133
Likes: 210
|
Post by webwiz on Aug 3, 2015 7:25:50 GMT
I don't see how an interest paying account would work. The whole point of a client account is to segregate clients money from the firms. So who does the interest belong to. If the clients then there is a massive allocation problem. If the firm, then unless the interest is paid into a separate account then the segregation is compromised.
|
|
locutus
Member of DD Central
Posts: 1,059
Likes: 1,622
|
Post by locutus on Aug 3, 2015 7:49:32 GMT
I don't see how an interest paying account would work. The whole point of a client account is to segregate clients money from the firms. So who does the interest belong to. If the clients then there is a massive allocation problem. If the firm, then unless the interest is paid into a separate account then the segregation is compromised. There are all sorts of rules which govern who interest rightfully belongs to with client accounts. You can have designated (client's name and client's interest), undesignated (interest belongs to the organisation) and a mixture of the two depending on what the bank provides. What I have proposed is very common amongst solicitors handling house purchases. The only difference is that in this case, the interest would go to a provision fund.
|
|
webwiz
Posts: 1,133
Likes: 210
|
Post by webwiz on Aug 3, 2015 9:02:18 GMT
That's interesting. So if SS are not currently using one of these they could switch to one and boost the PF at no cost to themselves. Seems a good idea at face value.
Edit: But after scanning the rules on the gov web site it appears the idea is a non starter. It looks to me that the interest must be paid to the client if over £20 and the calculation is so onerous that most firms will deliberately choose non interest accounts to avoid it. Solicitors conveyancing accounts might be different because of the large sums involved, but even then I suspect they will use a designated account so that the bank has to calculate the interest.
|
|
locutus
Member of DD Central
Posts: 1,059
Likes: 1,622
|
Post by locutus on Aug 3, 2015 9:18:22 GMT
Sorry, I meant which P2P companies use an interest bearing client account, as my understanding from an AC reply was that they are not allowed to. I think there is a subtle difference here. Designated interest bearing accounts are probably not allowed without additional AML and KYC checks. What I'm proposing is undesignated where interest goes to the organisation (and used to boost the PF).
|
|
|
|
Post by nickthefool on Aug 3, 2015 9:32:42 GMT
I wonder how many people actually leave money on the site, since the way it's set up (instant deposit/withdrawal) encourages you not to.
|
|
Investor
Member of DD Central
Posts: 662
Likes: 590
|
Post by Investor on Aug 3, 2015 9:48:43 GMT
Could not agree more, seems so little reason to leave money parked there, only a fool would do it!
|
|
mv
Member of DD Central
Posts: 156
Likes: 45
|
Post by mv on Aug 3, 2015 10:55:20 GMT
Also the amount of money left sitting there has to be offset by the amount of BACS deficit at any given time. I've accidentally owed SS £1000 for a week before.
|
|
|
|
Post by reeknralf on Aug 3, 2015 15:49:41 GMT
Transferring money in and out requires logging on, filling in security, and generally clicking at 2 different websites. I've had these exchanges on here before, with people who say p2p is a hobby, and so will spend any amount of time necessary to increase their return by 0.00001%. I regard it as a way to earn a bit. I've got better stuff to do than spend my time clicking at web pages for a few pence.
|
|
