RateSetter-backed lender acquired by Non-Standard Finance
- Marc Shoffman
- On August 3, 2017
RATESETTER investors are likely to get repaid early by George Banco following the acquisition of the guarantor loans provider by Non-Standard Finance.
The peer-to-peer platform took a minority stake in former wholesale lending partner George Banco in May but it was announced on Thursday morning that Non-Standard Finance has acquired the firm for £53.5m.
The deal will see all George Banco loans refinanced and RateSetter lenders will be repaid in full when the acquisition completes, which is expected to be in September.
Approximately £30m of RateSetter lending is currently outstanding to George Banco and many lenders will be repaid early as a result of the refinancing.
The specialist lender provides finance to borrowers with poor or no credit history by involving a third person who can step in if the former run into repayment issues.
RateSetter had initially intended to lend directly to George Banco borrowers after acquiring a minority share, but decided against this in June.
The platform had been winding down its wholesale lending business since last December, after it first emerged that the City watchdog was uncomfortable with P2P platforms lending to other lenders. In February, the Financial Conduct Authority confirmed that the practice may be in breach of the rules.
Last month it gave investors the option to sell out of their investment free of charges after detailing “interventions” it had made on three former wholesale lending partners.
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