Actual Repayment Stats (TMP)

For what it's worth my stats don't look great!


9 loans over 6 months

6 paid back early Average approx.11 days

3 late average 42 days
( range 10 to 76)

Definitely looking out of pocket  - any of the 3 overdue ones not repaying would wipe out all interest received.

It seems in my case I have been somewhat fortunate. I have had 12 loans,11 of which have repaid. The only outstanding loan is on the new terms, and installments that were due to be in October and November have not been made. The entire loan is now overdue in terms of the final payment. If there a zero reocovery on this loan (hopefully not) I will still be in a modest profit of about 3%.
It occurs to me that if I had been less fortunate I might also be in a loss making position. Making a profit early on in the process allowed me to reinvest the profits and withdraw any original capital.

I agree with you michaelc. A few of us are trying to piece together some idea of how TMP is performing. The best solution is some hard data from TMP. If you are monitoring this board perhaps a representative of TMP could give us an indication when or if this information might be available.

I have three defaults which pretty much wipe out the interest to date. Plus another three late, which I expect to default. I haven't had any loans recover from being late so far. Not looking good.

I am holding a number of late/default loans at the moment, and am very concerned at the apparent apathy being displayed by the platform. I've not heard ANYTHING from them regarding late/default loans.

Very worrying indeed.

You could "set your own rate", but it's important to understand why this was removed. I'm an advocate of customer choice, but really there wasn't a choice and the allusion caused problems.

This is defined as High Cost Short Term Credit, so the maximum daily rate is 0.8%. TMP shares this with lenders so the lender rate is 0.4%. With the recent regulatory cap, we are not allowed to let lenders go above 0.4%. and in actual fact virtually all loans were written at this lowest rate anyway, money above 0.4% rarely got deployed. So letting lenders choose a higher rate just caused delays, frustration and questions.

Arguably we could let lenders go below 0.4%. But this would require some IT work to have variable APR loans on the platform, and make sure we advertised correct representative APRs. Also lenders might not realise the risks, and offering too low a rate, would cause other financial issues for them. In the HCSTC market, a slightly lower daily rate and APR doesn't reduce bad debt as it does in the prime market. 

Hopefully the TMP product range will expand to cover different APR and risk quality (and loan length and value). But this will take time and investment.

This is a very different sector to the one the traditional P2P platforms operate, where having the lowest APR on the comparison sites (and associated" eligibility") can make or break a business.

That said, a personal goal would be to lower pricing to borrowers. This might one day attract better quality borrowers and generally be a good thing for the HCSTC market. Help put some of the incumbent morally dubious organisations under pressure.  But this is a personal goal.

Kevin.

This is good. One of the reasons the platform is at the higher risk end of the P2P spectrum is that loans are not fractionalised and we have there is no provision fund. We are the "roller coaster of the P2P world".....

As a result lender returns will vary dramatically, with some enjoying fantastic returns and others doing disappointingly badly (and those with bad experiences tend to be more vociferous). Everyone is somewhere different on that bell curve, and that's not ideal.

That said, I'm very expectant the overall default performance will improve even further from where we are today. For the following reasons;

1) Credit acceptance is evolving constantly to be based on our experience and own loan performance data, rather than a default model for the HCSTC market as a whole

2) Loans are now amortising over 8 and 12 weeks, rather than expecting customers to make single large capital and interest payments in one go. This also increases liquidity for lenders with payments, and if there is a default it'll be for a smaller amount

3) A TMP specific data scorecard is now in place, working in conjunction with the bureaux scores.

4) Loan values have been skewed towards lower £250 for new and higher risk customers. Making payments more affordable.

5) Borrower portfolio is increasing, and repeating business with us. This rapidly growing segment has improved acceptance, lower capture costs and lower bad debt. 

Launch is always hard at the start with no existing portfolio of borrowers, no data (relying on "expert" decisions) and as the new lender in town a magnet for dodgier borrowers. We are very grateful for our early adopters and it's great to know people are making a return, but onwards and upwards from here is encouraging. 

Longer term we want to embrace Open Banking, and think about how a pool or fractionalisation product could work. But these are longer term projects and will take money and IT resource before implementation.

Kevin.