Secret Investor: Funding Circle overtake Zopa and rates on personal loan lending fall

Last post: May 18, 2017

Funding Circle overtake Zopa to become the P2P that has lent the most… There is good news for Zopa as it becomes the first of the “Big 3” to receive full authorisation from the FCA paving the way for it to offer an IFISA… Meanwhile, the top rate of return at the third of the “Big 3” – Ratesetter – falls 2% in as many months to just 3.2% pa.

Funding Circle overtake Zopa to become the P2P that has lent the most… There is good news for Zopa as it becomes the first of the "Big 3" to receive full authorisation from the FCA paving the way for it to offer an IFISA… Meanwhile, the top rate of return at the third of the "Big 3" – Ratesetter – falls 2% in as many months to just 3.2% pa.

Totals lent to date (18th May 2017)

*All data correct at the time this blog was compiled.


Assetz Capital - £254,372,172
Funding Circle - £2,295,816,694
FundingKnight - £31,485,000
FundingSecure - £119,466,284
Money & Co - £6 million approx
Rebuildingsociety - £11,500,000
ThinCats - £237,491,000
Invest and Fund - £3 million plus
LendingCrowd - £11,115,281
ArchOver - £34,523,000



Zopa - £2,290,000,000
RateSetter – £1,881,771,286

Lending Works – £53,201,934



Assetz Capital  

Lent to Date: £254,372,172 – fortnightly increase of £6,782,412 – 2.74% growth.

When this blog was compiled, there were 76 upcoming loans with 2 imminently due to be drawndown. The pipeline seems to be growing, the number of upcoming loans used to be in the low 50s and even a fortnight ago the figure was 69.

Highlighted Loan: A borrower with a chain of pubs in the North West was looking to raise £1.4 million to purchase a mixed-use property in the centre of Liverpool. The Loan to Value ratio was quite low at around 60% while there were quite high levels of additional security in the shape of a first charge over another premise in their portfolio, a Debenture plus Personal and Corporate Guarantees. The return offered to investors was 7% pa, but this is the same as the Great British Business Account which has the additional benefit of being covered by a Provision Fund so there was no point investing directly into this loan.

Managed Accounts: The following accounts automatically distribute funds on behalf of investors across the platform's portfolio and are covered by a Provision Fund:

Quick Access Account (3.75% pa return); 30 Day Access Account (4.75% pa return); Great British Business and Green Energy Income Accounts (both of these offer a return of 7% pa).

Platform News: Assetz Capital extended the deadline when the 30 Day Access Account reverts back to 4.5% pa from the current bonus rate of 4.75% pa. Initially the window was set to end on 11th May but this has been put back to 6th June. The platform says no further extensions will occur.

Funding Circle

Lent to Date: £2,295,816,694 – fortnightly increase of £51,725,272 – 2.3% growth.

This was the first time since late March that the fortnightly growth exceeded £50 million.

There were 10 auctions ongoing when this blog was compiled although as loan requests tend to fill in a matter of hours on this site, that is not a fair reflection of throughput.

Secret Investor's Activity: This is one of the sites which I have the most exposure to -because they have the largest number of manually selectable loans.

Below are highlights from my activity over the past fortnight:

Highlighted Loan Invested in:

Expansion Loan of >£252k to container handlers (D risk rating 17.9% pa return). This Felixstowe-based company is looking to expand into another couple of ports. Balance sheet more than covers the loan although the one worry was that their previous FC loan was rated A+ - why the downgrade? I couldn't see much wrong with financials.

Highlighted Rejected Loan:

Expansion Loan of >£72k to gym (D risk rating 17.9% pa return). Quite simply this business had negative Shareholder Funds/Net Assets to the tune of £17k.

Defaulted Loans Update: Last Thursday a loan I had made to a small hotel was defaulted. The loan was only taken out last May but they were already behind with their repayments by August – before the end of the Summer season. They are now 4 months in arrears and not responding to FC's attempts to contact them. I have £35 of capital outstanding.

Yesterday I received news that I may have lost a similar amount on a loan for which the recovery process is close to reaching a conclusion. The house over which FC believed the borrower had joint ownership was solely in the name of his wife. To recover any funds, FC now need to prove the borrower contributed to the mortgage. There seems to have been a major failure in FC's due diligence process when the loan agreement was originally drawn up. Very worrying.

Platform News: Despite being founded 5 years later, Funding Circle have overtaken Zopa as the P2P platform that has lent the most capital.


Lent to Date: £31,485,000 – no change.

There were 0 auctions ongoing when this blog was compiled – only 1 loan has appeared on this site in 2017.

I received a strange email from FundingKnight last week. Because I hadn't logged in to my account for a while they threatened to close it but as they've not listed any loans since the start of the year (they send an email when a new auction begins) I have not had cause to visit their site. According to the forums, I wasn't the only one to receive such an email, perhaps it is automatically generated when accounts have been dormant for a period of time. This assumption is supported as I was still able to log in today.


Lent to Date: £119,466,284 at the end of April – monthly growth of £8,745,345 (7.9%). April's figure was received just after the previous blog went to press.

There were 5 auctions ongoing when this blog was compiled.

Highlighted Loans: A borrower in a hurry was looking to raise £188k to complete the purchase of a property after another lender was unable to provide the full amount that was required. This meant FS only held a second charge and the LTV for the total borrowing was 70%. Balanced against this, the base rate of return was higher than usual at 14% pa and those willing to commit significant amounts of capital could enjoy bonuses of up to 4%. This seemed a riskier loan than usual and my maximum of £75 seemed quite sufficient.

Defaults: The assets held against 2 or 3 of my defaulted loans seem to be getting closer to being sold.

Platform News: FundingSecure have simplified their secondary market by reducing the discounts/premiums that sellers can set to -/+ 1%. I always believed the range was previously too great.

Money & Co

Lent to Date: £6 million approx. (latest available figure)

When this blog was compiled there were 2 auctions taking place both of which were raising additional funds for the guaranteed to buy a home business and marquee company covered in previous blogs.


Lent to Date: £11,500,000 – fortnightly increase of £100,000 – 0.88% growth.

There were 0 active auctions taking place when this blog was compiled.

Highlighted Loan: An IT business that allows companies which have a group structure to consolidate their financial information, were looking to raise £53k to bolster their marketing department. Only a Personal Guarantee was offered as security but I invested £20 using funds recently repaid from another loan to get a return of 18% pa.


Lent to Date: £237,491,000 – fortnightly increase of £5,185,000 – 2.23% growth.

There were 2 active auctions taking place when this blog was compiled.

Highlighted Loan: A ballet school which incorporates a production company were looking to raise just under £200k, to be repaid over the next 4 years. This will replace expensive short term finance from their bank. The business seemed sound although there wasn't a great deal of security with only a Company Debenture and a Personal Guarantee – the latter is no more than a token gesture as the borrower has minimal equity. The main value in the company are the sets used for performances said to be worth 3 times the value of the loan. While you wouldn't bet the farm on this, a small amount would be worth risking for a return of 12% pa.

Invest & Fund

Lent to Date: Over £3 million

There was 1 active auction taking place when this blog was compiled.

Highlighted Loan: Developer in the Midlands returned to the site for his fifth tranche of funding for a project that will see two new homes built on the site of a former farmhouse. The latest cash injection was for >£121k out of a total facility of £2.4 million. An update from the building site revealed no serious issues and investors were offered a return of 9.5% pa.


Lent to Date: £11,115,281 – fortnightly increase of £117,300 – 1.07% growth.

There was 1 active auction taking place when this blog was compiled.

Highlighted Loan: A family-run electrical contracting business was looking to raise £52.5k to fund their expansion plans. In their proposition, they claimed their assets exceeded liabilities by a factor of 4:1 but this didn't tally with what was shown on the balance sheet. Possibly the claim included property offered in the Personal Guarantee but this wasn't confirmed despite the question being posed in the Q&A. Had there been a positive response, I would have put in a bid in the low teens but, having had a few LC loans go bad, the lack of engagement prevented me from clicking the "Bid" button.

Platform News: LendingCrowd were serious about reducing the length of their auctions as mentioned in my previous blog. The highlighted loan was only listed for 24 hours and I seem to have missed one today which must have been available for less than that period. I'm going to have to be on the ball in future. I hope they leave borrowers enough time to answer questions from potential lenders.


Lent to Date: £34,523,000 – fortnightly increase of £1,945,000 – 5.97% growth.

There were 2 auctions taking place when this blog was compiled.

Highlighted Loan: Providers of Electronic Point of Sale and Back Office technology to fuel stations and convenience stores were looking to raise £1.1 million to pay off existing debt and also to provide working capital for their rapidly growing business. Interestingly, the capital required was being raised via a couple of separate loans which had security provided in two different ways. Both were covered by the Accounts Receivable but one was also insured by Coface.

As a result of the insurance, that loan offered a return of 7% pa compared to 8.5% pa for the other one. The latter filled far faster suggesting investors are tempted by higher levels of return rather than additional security.


This platform, which lists loans from multiple sites, had just 3 auctions taking place today and all were from P2P Lenders covered elsewhere in this blog.




Lent to Date:  £2.29 billion – fortnightly increase of £40 million – 1.78% growth.

Returns: Zopa's 3 accounts offer returns of 2.9%, 3.7% and 6.1% pa depending on the levels of access and whether or not they are covered by the Provision Fund.

Zopa distribute investor's money mostly to unsecured consumer loans.

Platform News: Zopa have become the first of the "Big 3" P2P Lenders (Zopa, Funding Circle and Ratesetter) to receive full authorisation from the FCA paving the way for them to offer an IFISA in the near future. This may help them to repass Funding Circle to regain the title of the P2P platform that has lent the most… at least until FC receive the go ahead to offer a tax free account themselves.


Lent to Date: £1,881,771,286 – fortnightly increase of £11,853,083 – 0.63% growth.

This is the lowest fortnightly growth on record for this site.

Returns: Interest rates are set according to supply and demand. They currently range from 2.8% pa to 3.2% pa depending on the length of the investment. Compared to a fortnight ago, the former figure is 0.2% higher while the latter has reduced by a massive 1.1%. This figure was over 5% 2 months ago, no wonder throughput is so low.

Capital is covered by a Provision Fund. Ratesetter proudly boast that no investor has lost a penny since they launched in 2010.

Platform News: In a bid to expand its portfolio of borrowers, Ratesetter has acquired two businesses that supply finance to the customers of car dealers.

Lending Works

Lent to Date: £53,201,934 – fortnightly increase of £1,370,709 – 2.64% growth.

Lending Works has now provided borrowers with more than £50 million of capital.

Returns: 3.5% pa and 4.4% pa via an IFISA or standard account for 3 and 5 year investments respectively. These rates have reduced by 0.1% over the past fortnight.

As well as a Provision Fund to cover investor's risks, this site also insures borrowers against redundancy, fraud, illness and accidents making this a very fair site for all concerned.

****Disclaimer: This blog contains the views of the Secret Investor. Your capital is at risk when lending via all P2P Platforms. You're recommended to speak to a qualified Independent Financial Advisor.