Lending Works turns four!
It all started one rainy Sunday morning in a small Farringdon office back in January 2014. After nearly 18 months of blood, sweat and tears on the part of our CEO and CFO, the Lending Works dream became a reality. A back-of-the-envelope idea had evolved, and now officially launched as a living, breathing company.
At that time, the concept of peer-to-peer lending in the UK was still very much in its infancy. Yet the 48 months since have seen it gather momentum at breakneck speed, and one of the driving forces of the sector’s march towards the financial services mainstream in this country has been its third-biggest consumer lending platform.
Reflecting on Lending Works’ journey
As we (briefly) stop to celebrate our fourth birthday this week, we also look back with pride on what we’ve achieved. However, while unrelenting progress is a common denominator across each of Lending Works’ four years, it is interesting to note the distinctions between them.
The first year was one where we successfully established our brand. Preaching fairness to the customer was hardly novel within UK finance services. But consistently delivering it certainly was, and by focusing on customer service, and ensuring that each transaction, user journey, or even phonecall was handled with the best interests of lenders and borrowers at heart, our brand credibility quickly began to flourish.
Such solid foundations paved the way for a very successful second year in 2015, as Lending Works enjoyed threefold growth, facilitating over £15 million in loans over the 12-month period. It was also our first dalliance with the Moneywise Customer Service Awards – the Oscars of UK personal finance, and ones which saw us confirmed as the runner up in the ‘Most Trusted Personal Loan Provider’ category.
Our third year saw us shift the focus slightly away from the numbers, as we looked to strengthen our team, bringing in industry experts in compliance and data science. The former helped to ensure that we became the first P2PFA member to be fully authorised by the Financial Conduct Authority, while the latter – among many other things - enabled us to optimise customer journeys. This was further augmented by the launch of our new-look website in late 2016; one which our users still benefit from today.
Then came 2017: a year which many businesses around Britain were affected by economic uncertainty, and may well have been happy to see the back of. However, for Lending Works, it was one which was unequivocally a success. Writing nearly £50 million in loans. Unveiling cutting-edge new partnerships. Unlocking new channels of loan origination. Launching our new ISA (again, the first P2PFA member to do so). Innovative new technologies to expedite and further secure the loan application process. Numerous milestones and awards.
Our fourth year had it all, and a whole lot more.
A look to the future, and a tribute to our customers
Yet while we are proud of all that we’ve achieved, we’re even more excited about what the future holds – both for the year ahead and beyond.
Our ever-expanding team of experts keep their eyes on many moving targets each day. In 2017, we placed a lot of emphasis on attracting creditworthy borrowers to our platform and ensuring that they benefited from a genuinely efficient, world-class customer journey. Such is the interconnectedness of the peer-to-peer lending ecosystem that, what’s good for borrowers, is good for lenders too. By bringing in streams of prime loan applicants, lender queues got shorter, and the upward pressure was put on returns – this at a time when savings rates, by comparison, remained utterly derisory.
Yet 2018 will see us put some serious elbow grease into ensuring that our lenders – both existing and prospective - enjoy the best possible experience when using the Lending Works platform. We have a number of exciting projects in this respect lined up for the year ahead; ones which we will unveil in due course. This focus, coupled with many other initiatives across the business, leave us brimming with confidence that 2018 will be the best yet.
Beyond that, we’ll be looking to fulfil our wider ambitions as a company. Our impressive figures to date (over £85 million has now been lent between a total of nearly 20,000 satisfied customers) provide a tremendous launchpad upon which to grow our platform, and we expect these numbers to swell exponentially in the years to come.
But the pursuit of aggressive growth within a blossoming industry will never be at the expense of the values and practices which have allowed us to get to this point. After all, without our customers, there would be no Lending Works. So, as we celebrate birthday number four, we’d like to extend a big thank you to all our borrowers and lenders, and also to once again reaffirm our most sincere promise: we will always put you, the customer, first.
There is barely a week to go until the conclusion of the 2017/18 financial year, which means that, as ISA season begins to hot up, time is running out to take advantage of your ISA allowance.
At the Summer Budget in 2015, George Osborne had multiple nuggets of good news for investors in peer-to-peer lending (P2P), most notably the announcement of the new Innovative Finance ISA (IFISA).
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.