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Post by chris on Jan 11, 2016 9:19:25 GMT
I have no idea who, but I am avoiding the following - Platforms paying an exceptionally high introductory bonus. - Platforms not Uk based - Platforms with negligable deal flow and a tiny overall size - Platforms which are complicated - Platforms with low rates for unprotected risk- Platforms which are desperate based on their postings here - Anything else that is not RS, FC or Zopa I have dabbled in many others but am sticking with the three least likely to fail And I am avoiding RS and Zopa because the low rate of interest does not justify the risk of a non-FSCS investment (I got 1.3% on RS market rate recently!). I see no obvious reason why established platforms should fail (fraud aside) as the risks are taken by the lenders. And with all respect to westonkev he is hardly unbiased. Beyond the merely financial risks there's also compliance risk. The FCA can and will shut down platforms that they feel are not operating correctly, particularly in respect to regulatory areas such as client money where it is imperative to be able to demonstrate that no funds can be withdrawn that haven't been deposited even across accounts. For example if a lender deposits £100 and buys a loan unit but then that deposit bounces for whatever reason, the seller must not be able to withdraw that £100 before the transactions are unwound. AC follow a very strict interpretation of that rule based on the advice we've been given, others do not necessarily follow our line of thinking. The larger platforms will be spending hundreds of thousands of pounds on making sure they are as best prepared, well advised, and compliant as possible whilst we go through the regulatory process and will have the resources to be responsive to anything the FCA challenges them on or wishes them to change. I don't know how to judge that preparedness on a platform by platform basis but I would be surprised if every single platform of all sizes made it through unscathed. As I understand it a fair few applicants that weren't already operating have already pulled their applications, but that is second hand information so could be wrong. westonkevRS is as biased as anyone on this forum, we all have our own views, all have our favourite platforms, and I suspect a lot of us also seek to justify our own choices in which platforms we have chosen to invest in. RS are in general one of the good guys, and westonkevRS is genuinely knowledgeable about their platform and the industry as a whole. It's a small industry, there are always rumours, and on the point of not all of the smaller platforms making it through I suspect westonkevRS is right. They won't all be able to absorb the costs of compliance, nor take on the ongoing expense of doing things correctly. I would also guess that not every platform will have been working towards this for as long as the more well funded platforms, and will therefore be trying to do more reactively which may or may not be enough for the FCA.
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Post by westonkevRS on Jan 21, 2016 20:44:45 GMT
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james
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Post by james on Jan 26, 2016 0:19:57 GMT
According to an 8 Jan letter to investors from the trustee a group of bigger lenders was not happy with the initial offers of debt collectors paying only 40% of the amounts recovered to investors, less for loans outside Norway. Those lenders contacted others with a deadline of 11 Jan to agree to their proposal to handle debt collection themselves via a group of lenders or whoever they hire. Since the trustee has now announced a new deal presumably that measure failed to get the required 2/3 majority of lenders. However, the deals available from debt collection agencies seem somewhat better now, with 25% of the amount recovered to be paid to the debt collectors, 75% to investors, close to twice the initial proposed level. Also fees to be deducted to cover trustee costs for managing this. It seems that the actions of the lenders have resulted in a significantly improved prospective position, though we don't know how much difference there might be in the effort expended based on the lower cut for the debt collection agency. Still, this is only 75% of the debt collected, not 75% of the total debt, so it's likely that the actual position is going to be considerably worse, in my opinion likely to be less than 50% recovery. That doesn't seem too bad for defaulted payday loan borrowers but how may didn't default and just repaid on time isn't currently announced. Hopefully a lot, though I'm not optimistic. Lets hope that the FCA's requirements for ongoing loan handling are rather better than what is happening over at Trustbuddy, though do remember the apparent fraud and improper lending of investor's money as well as the high risk lending being done there, so it's worse than any likely loan book from current UK P2P firms that I'm aware of. |
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adrianc
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Post by adrianc on Jan 26, 2016 8:55:40 GMT
Still, this is only 75% of the debt collected, not 75% of the total debt, so it's likely that the actual position is going to be considerably worse, in my opinion likely to be less than 50% recovery. That doesn't seem too bad for defaulted payday loan borrowers but how may didn't default and just repaid on time isn't currently announced. Hopefully a lot, though I'm not optimistic. TBH, ~50% recovery is a lot better than I'd have expected given the initial reports of the scale of the fraud.
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james
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Post by james on Jan 26, 2016 11:05:39 GMT
Same here, that 50% is just for the potentially collectible loans, not for what I think the total loss might be overall. I'm not even going to try to give a guess about what that might end up being.
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adrianc
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Post by adrianc on Jan 26, 2016 15:05:35 GMT
If t'were me, I'd be regarding a shiny shirt button as an improvement on expectations...
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ablender
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Post by ablender on Jan 26, 2016 21:22:08 GMT
When will AC be applying for full FCA authorisation?
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Post by chris on Jan 26, 2016 21:30:34 GMT
When will AC be applying for full FCA authorisation? All platforms that want to continue operating will have to have already put their applications in, as I understand it. Our own window closed at the end of October if memory serves which I believe was the same for the other major platforms. We still don't know what the timescale will be though.
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james
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Post by james on May 31, 2016 19:15:58 GMT
An update on developments since the end of January: 1. Total outstanding funds were about SEK 300 million and so far, as of a 25 May 2016 report, SEK 50 million has been recovered by the trustees. Lindahl, the law firm investigating, has so far found no signs of embezzlement, just poor management and mixing lender and company funds. 2. The software platform has been sold to Northmill, who first declared their bid in December 2015, for less than SEK 10 million, below the originally estimated value of SEK10-15 million. Not clear whether this is in addition to the SEK 50 million. |
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james
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Post by james on Nov 4, 2016 20:38:37 GMT
I didn't find any material changes in very limited news coverage since the end of May 2016, though one headline implied five years to get out, but was not sufficiently well machine translated for me to be confident that it really did mean that.
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