Peer-to-peer lending platforms will collaborate more to bring down their costs over the next 12 months, an industry chief executive has predicted.
Jatin Ondhia, of property investment platform Shojin Property Partners, said that he expects platforms to work together more in areas such as the integration of investors and technology.
He used the analogy of a shopping mall, where customers are more likely to visit as they can access a variety of a products, to describe a scenario where P2P platforms would become more integrated and collectively accessible to investors. “I think there will be more stability in the market as a whole [in 12 months’ time],” Ondhia told Peer2Peer Finance News. “Firms need to be much better capitalised. I think platforms will work together more.”
Rather than “full-blown mergers,” Ondhia feted a number of ways in which platforms could collaborate, including “cross-pollenation of investors” with single sign-on functionalities for multiple websites.
He also suggested that platforms could bring together their technology as it was not as valuable to develop proprietary offerings these days. Secondary trading was another area where Ondhia saw the potential for co-operation, as there is “more liquidity if you bring it together”.
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Ondhia also sees the potential for platforms to collaborate on the underlying information given to investors, so that it is possible to compare the risk of projects on different platforms. “Firms need to agree on a standardised definition and risk metrics,” he said. “We’ve started doing this with our European counterparts. We have agreed 25 to 30 facts so that we can measure risk.”