Public Awareness Still a Major Issue for P2P Space

By AltFi on 5th September 2014

P2P/Marketplace Lending

The boutique investment bank Liberum has released some telling figures about public awareness of peer-to-peer lending.

Public Awareness Still a Major Issue for P2P Space

In its quarterly consumer survey, Liberum has found that 65% of UK adults are unaware of the existence of peer-to-peer platforms. Only 2% of adults are now or have been active investors in the sector. The investment bank expects to see a spike in public participation within the sector once peer-to-peer investments can be held within ISAs. Liberum predicts that the current figure of 2% could spiral up to as high as c.20% over the next decade – based on current participation rates for cash and equity ISAs. 75% of current P2P lenders will look to lend via ISAs once the logistics are sorted out by government.

Some key factors outside of the ISA were identified in the struggle to raise the profile of peer-to-peer lending. 88% of P2P lenders see regulation as a crucial factor in making the sector more appealing to the public. This flies somewhat in the face of recent research commissioned by LendInvest – which suggested that 78% of people felt it made no difference to them whether the industry is regulated or not.

Liberum has also pointed to the recently confirmed IPO of Lending Club – which is bound to intensify media focus on the space as a whole. That process is already under way. When AltFi covered the IPO announcement last week, we pointed out that a “Lending Club IPO” Google search, even so short a time after the event, pulled up articles from the New York Times, Forbes, Wall Street Journal and CNBC. Today you’ll struggle to comb through a major financial publication without finding some reference to the IPO.

Right from the get-go in 2014 we’ve seen rafts of research commissioned by the various platforms and their supporting cast. How do these latest findings from Liberum stack up against those earlier surveys?

  • In May, a Wellesley-backed survey of over 2,000 people found that 53% were aware of the P2P industry, with 9% describing themselves as very familiar with it.
  • Research from Madiston LendLoanInvest – also released in May – found that 75% of Brits prefer to approach their banks than alternative providers for loans of £10,000 or less.
  • RateSetter surveyed a more clued-in crowd in July – the readership of MoneyWeek. It was discovered that 82% of respondents believe peer-to-peer lending will become a credible challenger to the high street banks. And, tying in with the Liberum research, 56% of those surveyed did not know that P2P investments will be included within ISAs.

The more research of this kind that we can collect and cross-reference, the more complete our understanding of the industry and its potential development becomes. Click here to gain access to Liberum’s consumer sentiment survey.

Comments

AltFi Berlin Summit 2019

AltFi is coming to Berlin this Winter for our first annual Summit in the City.

18th November 2019