The growing demand for investments fulfilling environmental, social and corporate governance (ESG) criteria could benefit peer-to-peer lending platforms, industry stakeholders believe.
According to recent figures from the Investment Association, ESG investments quadrupled in 2020, while a separate study by OnePlanetCapital found that the ESG market is set to double in 2021.
However, many P2P platforms already offer ESG-style investments and are in prime position to attract ESG funds.
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Abundance has been promoting its environmentally and socially-friendly products since it was founded in 2009, while Ethex has been offering sustainable bond investments since 2017.
Folk2Folk recently pointed out that its investors have used their money to support their environmental concerns by investing in renewable energy projects.
“Change begets change and this trend is likely to accelerate,” said a Folk2Folk spokesperson.” Imagine if all investors invested with purpose as well as for profit. A shift along these lines could make a dramatic difference.”
Meanwhile, property lenders such as Relendex, CrowdProperty and Assetz Capital have been championing sustainable methods of construction and the creation of affordable housing.
Assetz Exchange – the sister company of Assetz Capital – has opted to focus on funding building developments which do some social good. However, Assetz Capital’s chief executive Stuart Law told Peer2Peer Finance News that “we’re not doing it because we want the ESG label.”
“We’re not putting that label on it because it just happens to be what we want to do,” he added.