Peer2Peer Finance News
The UK's first peer-to-peer finance magazine for investors and the industry
  • Home
  • News
    • Personal Finance News
    • Industry News
    • SME News
    • Global News
  • Property
  • IFISA
    • IFISA Guide
  • Video
  • Open Banking
  • Cryptocurrency
  • Features
    • Joint Ventures and Promoted Content
  • Comment & Analysis
  • What is P2P?
  • Partners
  • Events
    • Past Events
  • P2P Power 50
    • Power 50 2020
    • Power 50 2019
    • Power 50 2018
    • Power 50 2017
  • Sign up to our e-newsletters
  • Magazine
  • Directory
  • Jobs
  • My Account
    • Manage Account
    • Change Password
    • Log In
    • Log Out
shutterstock_234456628
April 9 2018

UK rate rise could spell trouble for some P2P platforms

Michael Turner Industry News, News Bank of England, base rate, Blend Network, FTSE 100, interest rates, Yann Murciano

PRESSURE is mounting on the Bank of England to raise interest rates, but the chief executive of peer-to-peer lender Blend Network says this could be a problem for platforms offering lower yields.

The central bank held the base rate at 0.5 per cent last month but surprised the market with a 7-2 vote, while minutes from the meeting hinted of tighter monetary policy in May. The nine policymakers had voted unanimously to hold rates at February’s meeting.

Read more: Inflation finally falls but still beats savings returns

Blend Network’s Yann Murciano told Peer2Peer Finance News that rising interest rates, which will boost cash savings rates, will put pressure on P2P platforms that offer investors low single-digit returns.

Read more: Blend Network launches with vow to be the “Goldman Sachs of P2P”

“If you have a platform offering three or four per cent – for them it’s quite bad,” he said. “If you can get two per cent from a cash savings account, then why take the extra risk for only a little bit more?”

Blend Network offers returns of around 12 per cent, which it says gives it a buffer against rate rises. Murciano says that high yield is what attracts investors to switch from equity markets. February’s sharp fall in equities – which saw the FTSE 100 drop by 3.5 per cent in intra-day trading – saw investors flock to Blend Network, according to Murciano.

“When the market came off last month we saw a lot of people subscribe immediately because they wanted to get some yield,” he said. “Debt is much less volatile.”

Read more: Bad news for savers as Bank of England holds interest rates

This story appeared in the April issue of Peer2Peer Finance News, now available to read online. 

EasyMoney: Bank accounts cost savers £1bn in lost income last year Invoice finance: The business lifeline

Related Posts

Businesswoman Writing On Checklist

Industry News, News, Property, Top 3

Proptee to apply for full FCA authorisation ahead of launch

credit card

Industry News, News, Personal Finance News, Top 3

Credit limits slide despite surge of new loan activity

Business handshake and business people. Business concept.

Industry News, News, Top 3

NorthRow appoints new chief executive

Popular posts:

  • Government responds to P2P fraud query
  • FCA lumps P2P lending in with higher risk products again
  • The alternative lenders accredited for CBILS
  • 4th Way gives its views on Zopa and Funding Circle returns
  • Funding Circle to offer first and second draw PPP loans
  • SME lender warns many companies will not survive
Back To Top
  • Home
  • Contact
  • About
  • Team
  • Advertising
  • Subscribe
  • Privacy
  • T&Cs
  • Disclaimer

Follow Us on Social Media

© Peer2Peer Finance News 2020
• Additional design by