Collateral raises interest rates and will launch referral scheme to entice investors
COLLATERAL is raising the interest rates on its larger loans and launching a referral scheme to attract more investors.
The peer-to-peer pawnbroking platform is increasing returns to 14 per cent on its largest facilities. Next week, it is unveiling a incentive scheme, whereby investors will get £25 credited to their account if they refer a friend who invests £1,000 for at least three months.
“Our deal flow is very strong – we’ve got 10 loans set to go live in the next two weeks,” a spokesperson told Peer2Peer Finance News.
“For us it’s about matching that deal flow. Some of our competitors have over 5,000 investors. We currently have 1,291 investors and we’re attracting 150 a month organically, but we’d like to increase these levels to match the deal flow.”
Higher interest rates and an upcoming referral scheme are just the latest measures that the Manchester-based platform has put in place to attract more lenders. Last month, it launched a “sliding-scale” cashback incentive on its largest loan to date, followed by other cashback offers.
Collateral’s largest loan to date is a £1.683m development loan for student accommodation in Bolton. The loan was previously on the platform of another P2P lender, which is understood to be MoneyThing.
Collateral is currently paying the interest on the previous loan, with the Gibraltar-based borrower set to pay back all accrued costs at the time of drawdown.
The first tranche of the new Collateral loan is going live next week, the spokesperson said. This has been subject to delay as Collateral’s due diligence processes highlighted a late accounting filing that the borrower needs to resolve before the platform allows drawdown.