Assetz Capital chief executive Stuart Law does not expect the platform’s target interest rates to change in 2021 and said that the new withdrawal fee for adverse market conditions will not be applied anytime soon.
Speaking on a Q&A with investors hosted by Financial Thing, Law (pictured) said that the peer-to-peer lending platform is assessing the situation each month but does not forecast interest rates to change this year.
“We don’t anticipate our target interest rates will change in 2021 but we continue to assess them live month to month in case anything in market conditions changes,” he said in the Q&A.
“But at present we don’t. They’re down from where they used to be, it’d be great if we could give more to lenders in future. We don’t know whether we will, but we certainly want to.”
Earlier this month, Assetz Capital changed the way its access accounts work, including the introduction of a withdrawal fee that will only be charged during “non-normal market conditions.”
The platform is aiming to boost liquidity and reduce the likelihood of withdrawal requests being queued, which happened at the start of the Covid-19 outbreak last year.
Law said that the new fee structure for “non-normal market conditions” will be implemented in May but added that this is a theoretical fee that would only apply in extreme circumstances.
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“It is a potential fee that is very transparent and that is just in case, because all stakeholders need to be looked after in a cycle,” Law said.
“The new fee structure will be implemented in May, the next cycle may be in seven or 10 years’ time and in all likelihood would we even have to charge it then? At the start of Covid we were just coming out of a growth phase.
“This fee is there, it might happen. Do we have to apply it in the next recession if it’s in seven years’ time away? I sincerely hope we don’t have to. But will it impact anybody in May, June, July or August? We have no expectation of that at all.
“It’ll come in May, but it’s a theoretical fee because we expect to be in normal market conditions by May potentially or very close to then, if not then or even April. The likelihood of anyone being charged it is looking very minimal.”