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Peer2Peer Finance News | January 17, 2019

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Investors back auto-lending as top P2P platform feature

Investors back auto-lending as top P2P platform feature
Marc Shoffman

AUTO-LENDING has been ranked as the most attractive feature of a peer-to-peer platform, research shows.

P2P analysts surveyed investors across 15 countries in Europe and found 79 per cent were attracted to platforms that offered auto-lending.

This came just ahead of having a buyback guarantee, which was backed by 74 per cent of investors, while 72 per cent valued having an automatic reinvestment function.

Around a third said they were attracted by being able to download statements, view performance data or sell on a secondary market.

Read more: Are robo P2P services worth the extra money? said the figures suggest investors want to save time and value simplicity.

“Investors prefer simple and comprehensive solutions,” the platform said.

“Automated investments meet this demand by offering a whole range of different options and features designed to provide better safety of funds and save time for investors.”

It comes after Funding Circle joined the two other ‘big three’ lenders Zopa and RateSetter in purely offering an auto-lending option.

The manual versus auto-bid debate is important in P2P as it dictates the level of due diligence and diversification an investor will need to conduct.

All platforms will still need to check and approve borrowers, but auto-bidding allows an investor to let the platform spread risk and do adequate due diligence, whereas a lender selecting their own loans will also need to take on some responsibility to ensure they are not over-exposed to one business.

Other platforms still offer manual options, with higher returns. This will mean investors have to take more responsibility for diversification and checking up on the business they are investing in.

Read more: Auto-bid vs manual investing, which is truly P2P?