By Ryan Weeks on Tuesday 9 January 2018
TuTasa is trying to enable UK investors to hold loans to consumers in emerging markets within an IFISA.
A Latin America-focused peer-to-peer lending platform named TuTasa is seeking authorisation from the UK regulator. TuTasa filed its application under 36H rules in December 2017 and hopes to be authorised within the stipulated 12-month window.
The business is already headquartered in London. Its plan is to offer UK investors access to higher-yielding, geographically diversified consumer loans across a number of emerging markets.
TuTasa has just announced the launch of its lending operations in Argentina. The platform lent £2m in Uruguay within its first 12 months of operation. It claims that its rates are lower than those offered by local incumbents, which lend at an average of 65 per cent APR.
TuTasa’s average loan size is £750 and its loans carry an average duration of 20 months. It claims to be securing lenders net annualised yields in excess of 17 per cent.
“The assumption is that higher rates translates to higher risk, but this is not necessarily true,” said Marcelo Barreneche, CEO of TuTasa. He emphasised the benefits of geographical and currency diversification for P2P investors, particularly in the context of Brexit risk. Consumer credit conditions in the UK appear to have deteriorated in recent times, as highlighted by the adjustments of certain prominent lending platforms.
“The yields we can offer to lenders on our platform are up to five times the yields obtained from UK or US focused P2P lending platforms,” continued Barreneche.
As far as we’re aware, no other platform currently facilitates IFISA-eligible investments into assets that are originated overseas – certainly not in the consumer loans sector.
Now active in both Uruguay and Argentina, Barreneche says that TuTasa will be launching in more markets soon. Its investors are able to lend across multiple markets using a single account.
If authorised by the FCA, the company will be able to offer loans to UK customers, but is likely to preserve its focus on emerging markets for the time-being.