Ablrate has told borrowers affected by the coronavirus outbreak that it is unable to provide payment holidays but will offer assistance in accessing the government support.
David Bradley-Ward, chief executive of the asset-backed peer-to-peer lender said he realised it was a harsh call but said it is lender money rather than the platform’s.
“Our policy is that it is business as usual and if a payment can be made it should be made. It is a really difficult situation,” he told Peer2Peer Finance News.
“As we are not balance sheet lenders we can’t make a call on payment holidays or not, so all we can do is help businesses where we can and work on accessing the grants and loans for businesses that they are entitled to.
“Fortunately, our book is strong so we should see too many issues, but inevitably some flexibility will be required.”
Read more: Coronavirus could boost P2P returns
A note to investors from Ablrate said borrowers in the leisure industries will be the hardest hit initially so the platform is focusing on access to funding for those borrowers.
“Our policy on any enquiries for payment holidays is that it is not our money, it is yours our lenders, and therefore we have to communicate to borrowers that we expect payments to be made,” the note from Bradley-Ward said.
“We are writing to borrowers today to update them on our policy. While this may seem harsh, we are attempting to soften this by giving all assistance on accessing the government measures to help.
“We do, however, have the balancing act of making sure that our demands for payment do not adversely affect the businesses in question during this volatile time and realistically our loan book will not be immune from short term issues.”
Bradley-Ward said he believed the government will do “whatever is required to pump money into the economy” and support businesses.
He also urged investors to evaluate their holdings before discounting loans and putting them on the secondary market to access cash, adding that the economy will recover.