The table lists the loan originations of p2p lending marketplaces for last month. Zopa leads ahead of Mintos and Ratesetter. I delisted Funding Circle from the table as they announced they will only update figures quarterly now (was daily). Furthermore they have withdrawn the downloadable loanbook. The total volume for the reported marketplaces listed in the table adds up to 380 million Euro. I track the development of p2p lending volumes for many markets. Since I already have most of the data on file, I can publish statistics on the monthly loan originations for selected p2p lending platforms.
Milestones achieved this month (overall volume since launch):
BDO has prepared and emailed the Joint Adminstrators’ Proposal to investors and creditors of the Collateral Companies last night. The report is also available publicly on the BDO website. I have read the whole report. I will not attempt to summarize it, but point out some findings that I find personally really surprising given that Collateral was an operation that managed millions of pounds of client money.
From the outset of the Administrations, we identified that securing the Companies’ electronic records would be critical. Following our initial meeting, the directors advised that all of the Companies’ IT functions and services were outsourced to an IT consultant. Both the directors and … advised that they had no access to the electronic platform, nor any back-up of the data contained within it, and they advised that the electronic platform had been decommissioned during March 2018 due to non-payment of outstanding bills; they did not therefore consider that the Joint Administrators would be able to recover the platform or the underlying data
The company outsourced IT operations, but kept no copies or backups of the data stored. Wow.
BDO did not give up on this, but located the servers and data forensics are working on recovering (part) of the data.
We have since made contact with the third party company holding the servers. Again, following protracted correspondence and with the assistance of our lawyers and my firm’s Forensic Technology team, we have located and secured the actual servers previously used by the Companies. There appears to be a significant volume of data still held on those servers and, as at the date of these proposals, we have taken steps to consolidate the contents of the different servers containing the Companies’ data into a single location (whilst preserving the originals intact). We shortly expect to receive a copy of the data, which we will then interrogate and review to better understand the nature of the data that has been recovered. Whilst it is not yet clear whether we have retrieved all of the Companies’ electronic data, nor whether it will be possible to restore the electronic platform, the Joint Administrators consider that this represents positive progress.
Given that the allocation of client money to loans and the bookkeeping is a primary tasks of a p2p lending marketplace I am appalled when I read this finding:
… also provided certain key information in relation to the investors and loan book, in the form of two spreadsheets (which I refer to below) and copies of email correspondence between his office and various stakeholders during the period in which he purported to act as administrator. …advised that he held no other books or records, and neither did he have any access to the Companies’ electronic platform, or the data contained within it.
Really? The data was held in two spreadsheets? Excel, maybe?
A last quote (highlighting is mine)
Members of the Joint Administrators’ team attended the Companies’ trading address in Manchester on the afternoon of their appointment. The address is a serviced office space, and the office provider advised that the Companies had vacated the office several months prior to the Joint Administrators’ appointment. There were no assets or books and records remaining at the premises.
Now to the good news. BDO confirmed there is money in the client and office accounts. And the report shows the directors are cooperating with the administrator. The report seems to classify investor’s money as trust assets which would, as I understand it, leave investors in a much better position, than the outcome would have been, if they would have been qualified as pure unsecured creditors.
BDO says it is too early to give a forecast to the outcome, given the circumstances, but asseses:
We would, however, note that, as summarised on the statement of estimated financial position attached at Appendix 2, the estimated claims of creditors exceed the book value of the assets held by the Companies (including trust assets). Therefore, even before taking account of any potential asset write-downs and the costs of the Administrations, it appears likely that not all investors and creditors will recover their entire exposure to the Companies and the Collateral lending platform.
A lot will depend on how much can be retrieved from the outstanding property loans, which will fall due by mid-November 2018 at latest.
There is a lot of investor discussion regarding the report on the P2pindependentforum.
Trying to look at this from a high vantage point:
In my opinion a lot of the work, time and fees of BDO would have been saved, if the data would have been stored more persistently by Collateral in the first place
Investors should try to keep some form of offline records. I know depending on platform and number of loans that might be hard and laborous to do, but look at what position the Collateral investors are in now. It is uncertain though if those investors that do have precise records on their loan allocation will be in any way better off than those that do not in the Collateral case
Investors trust regarding operations stability and bookkeeping of smaller UK platforms (Collateral had 5 employees) may be dealt a blow. It might become more important for smaller UK marketplaces to demonstrate robustness and durability of operations (e.g. through a detailed and transparent documentation of the living will, which is required for fully authorised platforms anyway)
The next steps in the Collateral case are described in the proposals in 15.1. and 15.2 of the report (page 20).
The table lists the loan originations of p2p lending marketplaces for last month. With the most recent Funding Circle figures not available at the moment, Zopa leads before Mintos. I track the development of p2p lending volumes for many markets. Since I already have most of the data on file, I can publish statistics on the monthly loan originations for selected p2p lending platforms. This month I added Grupeer.
Milestones achieved this month (overall volume since launch):
Table: P2P Lending Volumes in May 2018. Source: own research
Note that volumes have been converted from local currency to Euro for the purpose of comparison. Some figures are estimates/approximations. *Prosper and Lending Club no longer publish origination data for the most recent month.
The table lists the loan originations of p2p lending marketplaces for last month. With the most recent Funding Circle figures not availableat the moment, Zopa leads before Mintos. I track the development of p2p lending volumes for many markets. Since I already have most of the data on file, I can publish statistics on the monthly loan originations for selected p2p lending platforms.
Milestones achieved this month (overall volume since launch):
Table: P2P Lending Volumes in April 2018. Source: own research
Note that volumes have been converted from local currency to Euro for the purpose of comparison. Some figures are estimates/approximations. *Prosper and Lending Club no longer publish origination data for the most recent month.
Kuflink is a peer-to-peer property investment platform that brings borrowers and investors together. Our borrowers seek quick access to short-term finance that a high street bank would be unable to deliver, and our investors seek competitive interest that beats the typical rates offered with regular savings and current accounts.
Investing in property has previously been reserved for the very wealthy, with the money and means to put significant sums towards developments. The fintech revolution, however, has opened up a wide range of opportunities to retail investors who want to make meaningful returns on their cash, and in turn, opened up borrowing opportunities for a range of projects that would previously be denied such quick access to loans.
Kuflink has built a peer-to-peer platform in this emerging space to give retail investors the opportunities that were previously only available to high net worth individuals and institutional investors. In doing so, it also offers developers bridging loans to fund projects across the UK.
Since our launch of the p2p platform in 2016, Kuflink lenders have invested over 17 million GBP, with 0.00 GBP losses to date.
What are the three main advantages for investors?
Firstly, investors are offered high rates of return associated with property investments, which due to the nature of the property market are often very secure and predictable. In this age of mass-market retail investment, property opportunities have one of the longest track records, as people have been investing in property for hundreds of years, and long before technological advancements allowed us to build an accessible P2P platform.
A second main advantage for investors is that Kuflink has a highly effective due diligence procedure with an exceptional track record. We’re so confident in our vetting of loan requests that we cover the first 20% of losses in each individual opportunity on the platform. We really believe in each loan, and investors can be confident in all opportunities, as like them, we trust the platform with our own funds at risk.
Thirdly, investors are only offered access to the very best opportunities, as Kuflink only approves around 30% of loan applications. This gives lenders peace of mind that their investment is very likely to be successful.
What are the three main advantages for borrowers?
We have been providing bridging and development loans since 2011 of up to 1 million GBP, and our lenders have invested over 17 million GBP in just under 2 years, proving highly advantageous for our borrowers.
Firstly, Kuflink gives property professionals highly competitive rates on development loans. Many of these highly secure projects may not otherwise find funding, as Kuflink’s due diligence process filters highly promising opportunities that others may incorrectly deem inappropriate.
Secondly, borrowers can access a huge number of investors through the p2p platform, and are provided with a highly regulated means of crowdfunding their projects. This allows developers to work on projects that people really want, and can help to build strong community relationships between loan backers and project managers, leading to increased opportunities for future project funding.
Finally, Kuflink’s on hand customer service team is highly responsive to any queries or difficulties with loans, and can offer instant advice and support in the event of any difficulties.
What ROI can investors expect?
There are multiple ways for investors to lend their money with Kuflink, and each of these carries different estimated ROI.
Using the Auto-Invest feature, the platform will automatically diversify investors’ funds, and can offer up to 5.35% interest pa gross*. Investors can also choose to invest in certain opportunities to have more control over their portfolio. This is through Kuflink’s Select-Invest feature, which can offer up to 7.2% interest pa gross* over shorter periods of time. Finally, our IF-ISA offering also allows investors up to 5.35% interest pa*, with a £20,000 tax-free allowance for 2018/19.
You are advertising “investors never lost a pennyâ€. At a future point in time defaults will happen. What is the procedure for dealing with these and what overall unrecoverable rate of debts do you expect?
In the case of defaults, we instruct an insolvency practitioner to recover funds, however we expect our excellent track record to continue and hope we won’t need to act upon this in the future.
Is the technical platform self-developed?
The platform has been developed by our CTO, Hari Ramamurthy, alongside in-house front and back-end developers to ensure the technology seamlessly compliments our P2P offering. Since our launch in 2016, the platform has been operating smoothly, while undergoing continuous updates and improvements. Our in-house technical team can respond immediately to any borrower or lender issues with the software.
How is the company financed? Is it profitable?
The Kuflink platform as it stands today has evolved from alpha bridging, which provided the funds for the launch of Kuflink Bridging, which hosted the initial P2P offering. Kuflink’s model, as with many P2P platforms, is to take a small cut from each transaction, and currently runs at a profit.
What were the main challenges when launching your platform?
One of the main challenges we have had to face is inter-departmental integration. With so many moving parts across different disciplines, from property due diligence experts, to finance and tech experts, making sure there are good lines of communication and correct pathways in place have been essential to our successful operation.
You offer an Innovative Finance ISA with tax advantages. Can you please provide some absolute numbers on how many UK investors have invested into this? And are there more new subscriptions or more transfers in of existing ISAs?
We currently have many IF-ISA account holders who have so far made significant investments. There has been a large influx of transfers in from other ISA providers from both new and existing Kuflink account holders, however we cannot comment on the exact number of account holders or investment value as these figures are commercially sensitive.
Is Kuflink open to international investors?
Our platform is open and accessible to overseas investors with a UK residency and a UK bank account.
Which marketing channels do you use to attract investors and borrowers?
We use a variety of marketing channels, from online advertising, to PR and even major sponsorship deals such as our partnership with Ebbsfleet United Football Club and their Kuflink Stadium.
What factors do you see impacting the British property market in the near future?
Brexit is of course a big issue that could potentially impact property in the UK, with an air of uncertainty surrounding the future of the market. Although we expect this to have a somewhat adverse effect on the markets, we believe that UK property will continue to be an attractive area of growth and investment, and should be relatively robust to any larger market perturbations.
Where do you see Kuflink in 3 years?
We currently have [a] positive outlook for the next three years, even in the face of uncertainty in the marketplace. Our trends show that there is a steady increase in loan applications alongside growing demand from investors for lending opportunities.
We also have plans to continue the work reinvigorating local communities around Gravesend and across the UK through the Kuflink Foundation. We hope to expand our charity and community work, which currently includes sponsorship of Ebbsfleet United, work with Kent County Council, and charities such as Age UK.
You have one wish, that the regulator would fulfil. What is your wish?
We work very closely alongside the regulator and are satisfied by their requirements. Our platform is fully functional within the current rules, and we find that these are more than sufficient for our platform to run smoothly, fairly, and profitably.
P2P-Banking.com thanks Narinder Khattoare for the interview.
The table lists the loan originations of p2p lending marketplaces for last month. Funding Circle leads ahead of Zopa and Mintos, which is in the top 3 for the first time. The total volume for the reported marketplaces adds up to 599 million Euro. I track the development of p2p lending volumes for many markets. Since I already have most of the data on file, I can publish statistics on the monthly loan originations for selected p2p lending platforms.
Milestones achieved this month (overall volume since launch):
Table: P2P Lending Volumes in March 2018. Source: own research
Note that volumes have been converted from local currency to Euro for the purpose of comparison. Some figures are estimates/approximations. *Prosper and Lending Club no longer publish origination data for the most recent month.
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