LendingClub has revealed that investor returns are recovering to pre-Covid levels, as the platform said that it is “cautiously optimistic” about 2021.
However, the US-based peer-to-peer lending platform has warned that until a nationwide vaccine programme is rolled out in the US, economic recovery will remain slow.
In a blog on its website, LendingClub said that only 1.5 per cent of its outstanding loans remain on a payment plan, with 98 per cent of its borrowers not requiring any payment plan at all in 2020.
Returns on pre-Covid loans are tracking close to historical levels of around four per cent, the platform added, while newer loans are continuing to display higher credit quality, and the platform continues to target returns of five to 6.5 per cent for new issuances, depending on the loan grade.
“We’re cautiously optimistic about what 2021 will bring — a widely available vaccine and economic relief, perhaps — and we remain committed to helping both sides of our marketplace navigate the environment, whatever may come,” said LendingClub.
“We took swift and sustained action across the platform in 2020 in order to protect returns for investors.
“We added capacity to help borrowers over the phone, launched self-service options online for borrowers looking for help, developed multiple hardship plans to support payments, tightened underwriting and verification on new loans, and increased interest rates on new loans.
“Our efforts have paid off. Because of our proactive and aggressive credit actions, we continue to observe resilience on the platform.”
The platform’s latest update made no mention of its upcoming acquisition of Radius Bank, nor was there any indication that the lender plans to reopen to retail investors in any capacity.