P2P lending is huge in the US - Lending club is about to IPO I think.
I think the operator in Australia got investment from Westpac.
Good investment. No indication of what they spent though??
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Just had a quick look through Harmoneys website and I must say the interest rates charges, even for low risk borrowers are higher than expected. With the max being nearly 40% for high risk individuals.
The "Platform Fee" of 2-6% of the initial loan balance seems excessive though.
https://www.harmoney.com/how-it-work...est-rates-fees
The level of default and delinquency amongst certain borrower types is astonishing and the amount of administration and costs involved in managing their difficult loans well and truly justifies those higher rates.
I hope under this new platform borrowers are forced to put down decent deposits on the asset they're acquiring. One thing that became readily apparent from the finance companies and GFC, if young people don't have much skin in the game they're more than happy to walk away if that old XYZ asset doesn't perform.
I thought they looked high as well. I would think the most common would be debt consolidation but for that to be worthwhile, it needs to be less than the ~20% that the credit card companies charge.
My application when in today (lender, not borrower) so will be able to get a better look on the inside soon.
Do let us know. I did just fill out the application however it doesn't give me the option t use my webcam for a photo and I don't have a scanner on hand to copy my license. It does look rather interesting though. The main thing I'm curious about is the volume of loans available in the marketplace at present. The mention that they're intending to create a secondary market for the notes bodes well too.
All in all I'd say a good move from Heartland.
I made an account for Harmoney after I saw it in on Stuff a couple of weeks ago. Since then I can see there have only been between 2-7 loans that have been available to invest in. Hopefully as word gets out about it, this will become more popular and I will consider getting involved. Problem is you cannot currently sell your investments, so once you are invested in a loan which can be up to 60 months, you can't out if you need it. I think they are developing something on this though. Website is really cool. Hoping it takes off!