Assetz Capital has introduced a lender fee for investors, as it faces increased costs for managing its loanbook during the coronavirus crisis.
The peer-to-peer lender said in a message to investors that it was conducting more work on its loanbook to assess borrower health and said it was expecting to have to reduce or pause loan repayments for some commercial mortgage holders over the next three months.
Stuart Law (pictured), chief executive of Assetz Capital, said the platform is well funded but warned its monthly income would take a hit.
It is therefore making use of a previously unused clause in its terms and conditions to allow it to introducing a loan servicing fee.
From 1 May, lenders will have to pay 0.9 per cent per year.
“This fee is permitted in our terms and conditions, however we have never needed to implement it over the last seven years and we hope and expect it to be a short-term measure,” Law said.
“It is also a fee that many other P2P platforms already charge even in normal market conditions, and our fee is lower than many of those in any case.
“We wish to manage cash and reserves but also retain our strong team to ensure that we are ready for when the economy restarts as expected shortly.”
The platform is also taking extra funds out of its borrower retention account which will have to be recouped by those taking out loans in the future.
Assetz Capital also said it is in talks with the government about getting more large scale institutional funding, which it is believed would come from the British Business Bank.
It is also working on being able to facilitate the Coronavirus Business Interruption Loans.