Happy 10th birthday P2P lending!
For some, today may have been just another blue Monday. However, today also marked the 10th birthday of the peer-to-peer lending industry, and here at Lending Works we’re proud to acknowledge this landmark occasion.
The platform has flown under the radar for many years, and even today is considered something of an unknown quantity in many quarters. However, encouraging signs have been in abundance in the last 18 months, with a recent survey by Nesta revealing that the market doubled in value to just under £1.8 billion in 2014.
A further boost came from the news that P2P loans are set to be included within Individual Savings Accounts (ISAs) in early 2016. What remains to be seen is whether they will be included within the existing Stocks and Shares ISA, or if a separate wrapper will be created that is tailored to P2P and crowdfunding.
Either way, estimates in the wake of the revelation suggest that the industry could grow from £2billion to £45 billion in the next few years as a result. In addition, the incoming pension reforms will free up plenty of capital for pensioners in years to come, and the appeal of P2P lending as a halfway house in terms of risk and reward between a savings account and an investment in stocks and shares will surely make it an attractive option.
It’s an exciting time for Lending Works, and our sector as a whole, and as we find ourselves on the cusp of potentially spectacular growth, we’re celebrating a special day in our history: A decade of P2P lending, and a decade of improving the financial landscape.
The 2019 ISA season is now in full swing, and it's as good a time as any to focus on financial planning - and, within that, looking ahead to your retirement years to ensure financial security.
The Lifetime ISA (LISA), announced in 2016, would prove to be one of George Osborne’s last flagship gestures to UK savers and investors as Chancellor, eventually launching against a backdrop of anti-climax a year later in April 2017.
Over the last decade, there can be little dispute that the reputation of mainstream banks – and particularly the so-called ‘Big Four’ (HSBC, Barclays, Lloyds and RBS) – is at its lowest ebb.
The peer-to-peer (P2P) lending industry is now regulated by the Financial Conduct Authority (FCA). The regulatory framework has been designed to protect customers and promote effective competition.
Loan underwriting is the process that we undertake to analyse all of the information provided by each loan applicant and their credit file to assess whether or not that applicant meets our minimum loan criteria. As part of that process all data is verified, analysed and summarised to paint a picture of each applicant.
When you earn interest from a regular bank savings account, for example, the bank automatically deducts basic rate tax (currently 20%) before paying your interest. With interest earned from peer-to-peer lending, tax is not deducted automatically so lenders will need to declare their income to HMRC.
As 2018 draws to a close, with our bellies full of Christmas turkey, it's only natural to look back on the past 12 months and reflect. No doubt, it's been a turbulent one economically and politically, and not everyone has had it all their own way.