Propio plans to launch into the peer-to-peer lending space by the end of the year after being added onto the City regulator’s register as the latest appointed representative (AR) of Rebuildingsociety.
The property investment platform, which is moving away from mini-bonds, will initially offer residential loans throughout England and Wales before moving onto bridging and development finance.
Propio has been upgrading its technology and processes to ensure it is complaint for P2P. The platform is preparing to introduce a new website and transfer across existing investors, before branching out to new lenders too.
Tom Buttress, co-founder and chief executive of Propio, said it is creating a residential investment product suited for the post-Covid-19 environment.
He added that Propio will also launch an Innovative Finance ISA (IFISA) to ensure that lenders can invest in all of the platform’s products via the tax wrapper.
“We are incredibly pleased to receive P2P lending AR status from the Financial Conduct Authority (FCA),” said Buttress.
“I’m pretty excited given it’s been a long time in the making. This is a great day for the team and shareholders who have helped us make the changes required to start P2P lending.
“Our deep expertise in the crowdfunding and institutional property lending markets will enable a smooth transition to P2P, and we are excited to be able to offer our customers new P2P lending investment products, including an IFISA, from the new year.
“Our P2P investments will remain focused on property-backed lending, however we have sought to create products fit for the new economic environment; with higher levels of liquidity and risk spreading, as well as a focus on residential property rather than the more speculative activities such as development.
“We are creating a new interesting P2P investment product based on residential loans that sort of ties into work in the new economic environment post-Covid-19.
“We can see some of the products that have done well and some that have not, so we’ve tried to design a product that will meet investors’ needs in the future.
“I’d like to thank our team, shareholders, customers and our new regulatory principal Rebuildingsociety which has been supportive throughout the process.”
“We’re delighted to have successfully transitioned Propio from mini-bonds to P2P lending,” said Daniel Rajkumar, managing director of Rebuildingsociety.
“We’re confident that the improved standards will help to facilitate good customer outcomes, while supporting the economic recovery.
“We’re thankful to the FCA for their prompt review and approval, received within 14 days of submission.”
Propio decided to move away from mini-bonds after the FCA implemented a temporary marketing restriction for restricted investors.
In August, the platform raised £278,000 in total from its funding round and the government’s future fund to prepare for its delayed launch.
This followed an update from Propio in April in which it said it had already stopped offering new mini-bonds and a funding round it was undergoing was pushed back after a cornerstone investor pulled out due to coronavirus-induced uncertainty.