Exclusive: Kuflink opens up loan investments with 20% loss guarantee
The platform has said it's seen zero losses to date, as it unveils some changes to its peer-to-peer investing regime.
Announced today in a statement seen by AltFi, peer-to-peer property investment platform Kuflink has announced that 100 per cent of each of its loans will now be available for investment.
Previously, investors could only access 80 per cent of each loan on the platform, with Kuflink investing the remaining 20 per cent on a first-loss basis. Under today’s news, the platform’s 20 per cent investment has now been replaced with a first loss guarantee, covering up to 20 per cent of the total loan amount in the event of a loan loss before investors would be affected.
Since launching in 2016, lenders have invested more than £17m through Kuflink, posting zero losses to date. All Kuflink loans are backed by UK property up to a maximum loan value of 75 per cent, providing borrowers with quick access to short-term finance and investors competitive interest that beats typical savings and current account rates.
“All our investment opportunities are UK property based and whilst we are no longer co-investing, we are still providing the same reassurance through our 20 percent first loss guarantee.”
However, some investors have not taken the changes to be an improvement on Kuflink’s previous first loss policy. Complaints have ranged from the supposed reliability of a new provision fund, the lack of a Kuflink stake in a loan affecting its quality, and the loss of the platform’s appealing USP.
Khattoare responded to some of these comments: “Thank you for your patience whilst we reviewed your comments. We welcome your feedback and would like to thank you for your support and for being a part of Kuflink. Without our community of investors we wouldn’t be where we are today – one of the fastest growing property-backed P2P lenders in the UK.
“We are successful because we cater for our customers. As per investor demand we have replaced our 20% stake with a 20% first loss, providing increased availability to our investors. Kuflink is one of a handful of platforms that has zero investor losses. We are constantly investing further into our infrastructure to stay ahead of the curve.”
*This article was updated to reflect the sentiment of investors responding to the announcement, and Khattoare's follow-up comment.