A NEW peer-to-peer lender has launched which specialises in education finance for graduates and professionals.
Financial Conduct Authority-authorised Lendwise is a London-based platform which pairs investors with borrowers who want to fund postgraduate education or professional qualifications to enhance their skills.
Lendwise says it wants to fill a gap in high-street bank lending of this type, and will offer loans of up to £100,000 at rates of 7.5 per cent to 12 per cent as it launches following a successful pilot. Investors can earn estimate returns of 7.5 per cent a year on average, with investments in individual loans going up to 10 per cent a year.
When assessing borrowers and determining pricing, Lendwise takes into account education and career-related variables, such as the qualification or course the borrower intends to take, the length of their study and their repayment period, as well as their credit history and future earnings potential.
Borrowers who are in full-time education do not need to start repaying their loans until they finish their course, and there are no penalties for repaying loans early.
By lending to a range of individuals in different study fields and universities graduating over a number of years, investors can diversify their lending portfolios and reduce risk, the platform says.
It also has Lendwise auto-lend and loan filter features which let investors create a portfolio which matches their personal lending criteria, risk appetite and investment objectives.
Lendwise was founded by Ioannis Georgiou, Kypros Mouzouros, Evangelos Skianis and Rishi Zaveri who have all spent large parts of their careers working in banking and tech.
“Education finance is unique in that it is funding borrowers as they seek to fulfil their academic and career aspirations which in turn leads to higher future income,” said Zaveri (pictured), co-founder and chief executive.
“That means that our borrowers are more likely to be in a better position to repay over time. Education finance is not an afterthought for Lendwise. We are a specialised platform created to serve aspiring individuals. At the same time, Lendwise offers investors access to a socially responsible and impact investment opportunity in the future prospects of the best and brightest individuals.”