Post by andrewholgate on May 2, 2014 17:53:40 GMT
April has been another busy month for Assetz Capital on the platform with c£5.6m of loans being funded, £2.5m of aftermarket sales and lender numbers increasing further. Alongside that, we have been recognised in national press and specialist trade journals for our approach to credit risk management and our experience in lending. Not everything has been rosy and you will have noticed a new type of deal appearing on the system in April causing a few questions, which I will address later.
The P2P market continues to grow and expand, having lent a total of £1bn by 31st December 2013 and is on course for £2bn by the end of 2014. Assetz Capital has set targets to lend £100m in 2014 and to provide 10% of the annual loan volume in P2P in 2014. I'm pleased to say we are on course to reach that figure. Our average monthly growth rate is over 20% per month, as recognised by www.altfinancenews.com and we are the most consistent platform in the UK for delivery of these numbers. I'm also pleased to say that we are yet to have our first default and continue to lead the market in credit risk management.
However, the market place is more competitive than it was 6 months ago. We have seen the emergence of new competitors who have mimicked our model in taking tangible asset security and in offering return priced for risk not liquidity. We have also seen existing platforms taking our innovations in the last 6 months and trying to replicate them. One of the most successful innovations we have implemented is the underwriting. This has allowed all our loans to proceed without the risk of the auction failing to fill giving more certainty to lenders. What it has also led to is a huge growth in the aftermarket where some lenders have held back buying units until they are released after drawdown, thus avoiding the dead period where funds do not earn interest. Such innovations have offered choice to our lenders and allowed our growth to continue.
With the competition in the market place, Assetz Capital is continuing to develop and innovate in order to stay ahead. This has meant that we have to offer a more diverse product range to our introducers in order to remain competitive but also the price point is coming under pressure as more platforms fight for market share. This resulted in a new type of deal, known as a cash flow lend, being listed for auction for Aspinal of London. I will hold my hands up and say this was released without much fanfare and communication could have been better. The idea of a cash flow loan is that it is reliant of strong cash in-flow in the business to repay the loan over a short period of time. Typically the security will not comprise of a property, but will be other business assets such as stock and debtors. In this deal, I do not believe we waivered from our pledge to tangible security, as the stock is a tangible asset but carries more risk as it is also very portable. To that end we will be releasing an education document, as we did with the wind turbines, talking more about this type of loan and the risks. There will be more of these loans coming, but this is a small diversification rather than a whole sale change. The 4 loans that were listed on the platform after Aspinal have all been more in our traditional vein.
Finally, I will be travelling to San Francisco over the weekend to represent Assetz Capital at LendIt 2014, an international convention on P2P lending on Sunday, Monday and Tuesday. We will be one of 4 UK platforms to be present and we will be taking the stage to talk about P2P lending in Europe as well as having time to talk in more detail about Assetz Capital. For those who are interested I will be tweeting during the event using @assetzcapmd and #lendit2014
Have a fantastic Bank Holiday weekend, and thank you for being part of this amazing growth story.
Andrew