HNW Lending’s founder has said that the asset-backed peer-to-peer lending platform is planning to resume lending after exercising caution during the height of the pandemic.
Ben Shaw, director of asset-backed peer-to-peer lender HNW Lending, said it expects to complete its first loans since the start of the pandemic this week.
“As the directors of HNW Lending put in a first loss tranche into each loan, we’re obviously very focused on arranging loans that repay lenders in full as we would lose money before lenders in a loss situation,” he said.
“We have lost less than 0.01 per cent of capital since we have been lending on around 400 loans completed to date, and we aren’t in a hurry to change that.
“As a result, we have been a little hesitant to lend during the pandemic and its immediate aftermath so that we can first ascertain the impact on businesses and asset prices.”
He said the platform will probably complete on a £1m loan this week to an existing borrower with a good track record, which reduces the risk.
It comes as the platform’s annual accounts for the 12 months to March 2020, filed with Companies House, show that it remained in profit, with its profit and loss account at £51,521.
“We have made a profit every year of trading,” Shaw added.
“I’m not one of these people trying to build up a company with a theoretical value to float so instead we have to make money the old fashioned way, by making a margin between what the borrower pays us and what the lender receives.
“We keep our costs under control and don’t spend any money on marketing – we rely on a good broker network to feed us deals.
“We have a reasonable margin between what the borrower pays us and what the lender receives and that is where we make most of our money, but we also make money from arrangement fees and other fees, although often these tend to get rebated to the brokers who bring us deals.”