Commercial property focused lender Proplend has cut the red ribbon on its secondary market – the Proplend Loan Exchange (PLE).
Proplend is selling investments into the PLE as a means for accessing instant returns. Formerly the sole method of investing into the Proplend platform was to channel funds into a project listed in the “In Funding” section of the site. The problem with this course of action is that lenders will not begin earning interest on their money until the loan has been fully funded and drawn down by the borrower. Loans listed on Proplend’s secondary market, however, are already delivering interest payments to lenders – thus offering a swift access to monthly income if part-purchased.
This is a sensible promotional angle for the platform to strike. The first problem with any secondary market within the nascent P2P world is liquidity – a problem Proplend will seek to squash by first expounding the benefits of the PLE as an investment medium, rather than as an exit avenue.
The PLE currently displays 24 active loan parts – ranging from £5k to £31k in size. So the demand for trading amongst existing investors is clearly present. Each loan is accompanied by some basic information on the property against which it is secured, the size of the loan part, the interest rate secured by the original lender, the risk tranche, term remaining and loan status. The same depth of transparency is made available to PLE investors as was offered any given loan’s original batch of investors.
“The market for P2P loans and investment is growing rapidly and we believe that the delivery of a Secondary Market is an important facility for our investors. It not only provides liquidity for existing lenders should they wish to exit a loan prior to maturity but offers all Proplend investors an opportunity to start earning interest immediately after investing.”
AltFi is returning to Amsterdam for its second annual Summit in the city. The inaugural event last year was a roaring success, with key figures from across Continental Europe's alternative finance and digital banking sectors highlighted. These included Jeroen Broekema, managing director of Funding Circle Netherlands, and Mieke van Engelen, head of innovative partnerships at ABN AMRO's standalone lending platform, New10.