UKC

Does anyone here save with peer to peer lending(Zopa etc)

Just wondering whether to put a small amount in "to test the water"

I worked with a guy who was a fan of Zopa. He was very positive about it, whilst it’s your money that you lend directly to the people taking out loans, you only lend each individual a small amount of the whole loan so you manage your risk of default. I can’t remember what his return was but it was better than any other savings products so he was pretty happy with it.

My business keeps its 'tax money' in Lendy (formerly Saving Stream). They specialise in property development loans, the interest rate is good (~12%) and extracting money at short notice usually isn't a problem.

I’ve kept 20% of my cash savings in Ratesetter now for about 5 years.  That money is much more at risk than the other 80% but it also returns more rewards than the other 80%.

It gives me great pleasure to take help them take business away from the high street banks.  

I’m tempted to heed Spike the gremlin’s advice however and switch my investments to tinned food and shotguns.

Hmmm, how is that working out for your business then? How much money is tied up in defaulted/suspended loans? They have probably the worst default rate out of all p2p lenders! And quite a lot of the non-defaulted loans have extremely long and slow-moving sales queues.

To the OP - have a good read of http://p2pindependentforum.com - it's an independent site for users to discuss all aspects of p2p, each major company has a dedicated sub-forum. Lendy is particularly full of angry investors.

I used to use Lendy in the "good old days" before the defaults started racking up. I now use a mixture of several platforms, and have IFISAs with a few that offer that too (a tax-free ISA for p2p effectively). I now use Ablrate, Moneything (I lend to their non-property loans only), a bit in Ratesetter, and Unbolted. Last one is quite good as they do lots of small pawnbroker-type loans - it's much easier for a p2p company to sell a gold watch than a half-finished £17 million housing development project in order to make a reasonable recovery on defaulted loans. DON'T get greedy put a significant proportion of your savings into p2p, it is a high risk market and people can and have lost incredible amounts - think of it as gambling, only spend what you can easily afford to lose!

Yep.

Funnily enough I worked out today what I'd earned from Zopa on the last year.

2.6%.

The returns I've been getting this calendar year have been dreadful, two months of negative returns and two near zero.

I keep a fair chunk of my excess cash in P2P; probably a higher percentage than would be advised by a financial advisor, but it's money I can afford to lose if it all goes horribly wrong and the returns can be very good.

I don't use Zopa - they had a period a while ago of not taking new deposits because they were awash with investment, so I just ignored them. 

Ratesetter and Assetz (via their instant access and one month access) are comparatively pretty safe, but consequently low earning.  Growth Street is a little riskier but a little better paying.

I'm not at all a fan of Lendy; perhaps I've been unlucky, but the fraction of my loans that have been indefinitely held up through in defaults or extensions is enormous.  As they finally come back (usually because the asset has been repossessed and auctioned) I am taking my money out of the site.

MoneyThing has been brilliant - higher risk, but higher rates of return, and I've only ever experienced one default.  As my money comes out of Lendy this is generally where it's going.

Overall, I've had a return of about 9%, which will go up a bit if/when the remaining defaults in Lendy ever get recovered.  If you're thinking of this, spread your investment over several platforms because they can fail (I was lucky and lost almost nothing when Collateral collapsed earlier this year).  I found financialthing.com a really helpful comparison site.

Oh - if your potential investment is more than £1000 and can last for a full year, Ratesetter offer a £100 sign-up bonus at the moment.  This actually makes them one of the best paying as well as safest platforms there is - you'll probably make about 13-14% overall on that £1000 in the first year.

I have a sum invested via Ratesetter. It is only a smallish percentage of our total capital. So far I have received just about exactly 5%.  Not sure if the recent slight increase in Bank Rate will increase this. When a loan is paid back it is usually only a day or two before they lend the cash to someone else.

What people don't always realise is that your investment is spread over a large number of different borrowers, but I suppose the more you invest the more you should spread over a number of different P2P lenders in case one goes tits up.

RS has recently been allowed to provide an ISA, which I keep meaning to set up and move my investment into. I assume this will given an even better return. The key thing is don't invest money in P2P that you cannot afford to lose

Thanks for the informative replies. Given that I'm getting less than sod all on a building society account I'm going to give it a try by drip feeding initially

I dribbled money into Zopa a few years ago. Left it to itself last 3 years. What's in there seems to be bringing in just over 4%

Take a look at ABLrate. They're a P2B lender, and the ABL bit stands for asset-backed lending. They lend to SMEs at between 10 and 15%, with appropriate legal charges on company and personal assets.

In the couple of years I've been with them no lender has lost anything. One company who were buying a small aircaft to charter out defaulted on their loan, but ABLrate had a lien on the plane, seized it and found a cash buyer for it, and all funds were recovered.

Getting out money invested isn't so simple, but they operate a secondary market in which loans can be sold to other investors.

*cough* apart from ABLrate not being able to seize some shipping containers, that is - not in that one myself but it's been dragging out for a while and lender's funds are tied up in that for now, and have been for quite a while. Having said that, they have sorted out a recent issue with missed repayments very efficiently and sold the assets on for more than the value of the loan in quick time. One drawback with ABL is that they can have quite a few different loans to the same company, so it's worth bearing that in mind if you try and diversify with them. They do have a very good secondary market, maybe the best system out of all p2p sites - you can always sell out of pretty much anything very quickly if you want to, but it might involve getting less than what you paid for it (they allow variable pricing to buy/sell loan parts, once you get used to it it's a good system)

I've had some money sat in an isa earning F-A for a few years. And have some cash too. These seem like interesting ideas to make use of that cash, i'm just wondering if, after reading that brexit thread, about a potential dive in our economy, if it's a risky time to invest in these areas?