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Post by batchoy on Mar 12, 2014 22:16:19 GMT
Do I feel 'cheated' that others may now bid and pick up cashback ? No. No more than if I go buy something and a week later find its on a 10% discount. A trifle annoying on a personal level, but not cheated: that's a market dynamics for you. My wife feels cheated, and takes action as a result. If she buy's something one week and discovers it has been discounted the following week she will go back to the shop with the item and the receipt and demand the discount, if it is not given she will return the item and the buy it (or a new one off the shelf) back at the discounted price. Unfortunately this option is not available with this cashback offer as I can't unlend what I have already lent.
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bugs4me
Member of DD Central
Posts: 1,845
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Post by bugs4me on Mar 12, 2014 22:24:06 GMT
Do I feel 'cheated' that others may now bid and pick up cashback ? No. No more than if I go buy something and a week later find its on a 10% discount. A trifle annoying on a personal level, but not cheated: that's a market dynamics for you. I really cannot see the similarity here. If it's 10% discount then that 10% will apply to everyone. But if that 10% only applied to those that hadn't purchased in the shop for at least 30 days but you'd spent goodness knows how much over the past 4 weeks then I think you would be aggrieved to put it lightly. As a loyal customer you would in fact be penalised whilst casual users would get the 10%. So your example is not IMHO a good example.
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Post by Ton ⓉⓞⓃ on Mar 12, 2014 23:50:24 GMT
I've not seen the email can someone put it up?
It does sound somewhat inept as to how they've played this, it does get my back up but only slightly.
I'd be a lot more understanding if they had said they'd be doing a promo like this but that they couldn't include me now because of costs but they hope to do something in the future to make it up to me. Or something similar.
I appreciate that they have to get their Zombies members to wake up I wish they'd been more curtious to their Live members first.
I think I'll be lending as normal.
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Post by jackpease on Mar 13, 2014 6:27:00 GMT
I've lent recently and i've got the email.
I now agree with Bracknellboy that removing the ability to sell at a premium removes the incentive to bid in an auction. It's great to be able to buy and sell parts without cost - but the downside is why bother bidding?
People like Assetz because the loans are backed by assets - other platforms do simple loans based on box ticking and these can draw down as soon as signed and filled. If we are bidding on loans with assets, then it follows that there has to be a convoluted process before and after bidding with no certainty of closure. Proper security is the benefit - delays are the disbenefit. So being able to sell at a capped premium may overcome that disbenefit.
Or offer bidders cashback (all bidders!) which is effectively the same as being able to sell parts at a premium
jack
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Post by batchoy on Mar 13, 2014 7:08:12 GMT
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Post by Lep Recorn on Mar 13, 2014 8:41:41 GMT
The text of the e-mail :
Lend in the next 2 weeks for cashback
New incentive for a limited time only
How it works
In the run up to Easter we are offering a new cashback incentive for investors who haven't lent anything through our platform in the last 30 days.
We are offering the following tiered cashback incentives to our investors:
0.25% on investment below £10,000
0.5% for £10,000 to £100,000 of investment
1% for investments over £100,000
This incentive includes units purchased on the Aftermarket as well as current auctions and applies to the total amount of money that you successfully lend between now and midnight on Friday 28th March 2014.*
*Please visit our website to read the full terms and conditions on this offer.
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Post by Lep Recorn on Mar 13, 2014 8:45:02 GMT
So I have had £1K tied up in Red*** Com*** since the start of Dec and have been given £2.31 in 'compensation'.
But if I put £1K into anything, assuming I have not put anything in for 30 days, I will get a cashback of £2.50.
So much for loyalty!
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Post by andrewholgate on Mar 13, 2014 9:04:19 GMT
Please hang fire with your comments. I will give a full explanation in a few minutes.
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Post by whitmanthecat on Mar 13, 2014 10:14:46 GMT
...........At least it is offered to some semi-loyal customers who probably have loaned money already, as opposed to new sign-ups..... It doesn't say anywhere that new sign ups can't benefit. You might be right. The email seems geared to those with accounts that are inactive, yet a new account by definition would not have had any activity over that period and could be eligible. Not sure from the T&Cs though. We can wait for the AC comments.
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Post by Ton ⓉⓞⓃ on Mar 13, 2014 10:53:10 GMT
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Post by bracknellboy on Mar 13, 2014 12:29:48 GMT
Trying looking on the FC site: can't remember where, but possibly under tax treatment. They have statements on this, around it being 'inducement' etc. But basically the nub of it was that it isn't treated as taxable income (for personal taxation purposes).
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Post by andrewholgate on Mar 13, 2014 13:15:46 GMT
I understand that it is classed as taxable income but you should take the advice of a tax advisor or an accountant. I'm an accountant BTW, but I'm not a tax specialist.
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Post by bracknellboy on Mar 13, 2014 14:41:57 GMT
I'm definitely not an accountant.
FCs take on the way they do it is:
"Taxation of cashback
In certain circumstances Funding Circle offers cashback to investors. The cashback is considered an inducement to enter into a transaction and is received as a direct consequence of having made the loan.
Cashback promotions are not normally treated as income and are not subject to income tax or deductions. "
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mikes1531
Member of DD Central
Posts: 6,453
Likes: 2,320
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Post by mikes1531 on Mar 13, 2014 14:58:40 GMT
I understand that it is classed as taxable income but you should take the advice of a tax advisor or an accountant. I'm an accountant BTW, but I'm not a tax specialist. Surely AC must have a tax advisor/specialist they consult with who tells them exactly what they need to put on the statement they will be sending their lenders shortly after 5/Apr that will supply the numbers we need to insert in our tax returns. Will cashback payments appear on that statement? If so, how will they be described? And exactly what data for each of their lenders will AC be supplying to HMRC? We will be receiving a year-end statement of some sort, won't we?
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Post by pepperpot on Mar 13, 2014 15:04:42 GMT
I understand that it is classed as taxable income but you should take the advice of a tax advisor or an accountant. I'm an accountant BTW, but I'm not a tax specialist. Surely AC must have a tax advisor/specialist they consult with who tells them exactly what they need to put on the statement they will be sending their lenders shortly after 5/Apr that will supply the numbers we need to insert in our tax returns. Will cashback payments appear on that statement? If so, how will they be described? And exactly what data for each of their lenders will AC be supplying to HMRC? We will be receiving a year-end statement of some sort, won't we? I like the optimism for a 5/Apr statement. Last I knew, it was penciled in for Q2 or Q3 from the tech team.
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