By Lisa Walls-Hester on Friday 23 September 2016
RateSetter reports that investors have pocketed more than £50m in interest since the platform launched in 2010. It says investors have earned an average rate of 4.7 per cent on their money.
RateSetter has reached the £50m interest milestone without any individual investor losing a penny of their capital and interest thanks to the platform’s Provision Fund, which steps in to reimburse investors if a borrower misses a repayment.
Investors use RateSetter to lend money to individuals, businesses and property developers across the UK, with a total of £1.4bn lent to date, more than half of which has been repaid.
The platform claims to have 45,000 registered individual investors and says it has seen an increase in investor numbers since the Bank of England’s decision to cut interest rates in August, with over 65 per cent more active investors registering compared to the same two-month period last year.
Peter Behrens, RateSetter’s co-founder and Chief Commercial Officer, said: “RateSetter is all about giving individual investors direct access to the risk and return from loans - ending the exclusivity that banks and funds have tightly held onto for centuries.”
“Returning £50 million without dropping a penny is a great achievement - and this number is growing by around £2.5 million every month. The RateSetter market is unique, with interest rates set by thousands of investors and borrowers – not by the Bank of England or a faceless committee. As a result, there was never any question of us passing on a rate cut to our investors.”