Loanpad reached profitability in June this year, is onboarding another borrower and may introduce new products as it continues to scale.
Speaking in an interview on YouTube with Financial Thing’s Laurence Samuels, Loanpad chief executive Louis Schwartz (pictured) said the peer-to-peer lending platform has been growing steadily throughout Covid.
He said when many investors were looking to withdraw funds at the start of the pandemic, the platform managed to meet all requests on time, while the borrowers managed their developments “very well”, working with social distancing although some projects were delayed.
Schwartz said the P2P lender has now onboarded its seventh borrower with the first couple of loans expected next week.
He said there are possibilities for new accounts or products but any new accounts it offers would be as simple to use as the classical or premium accounts.
Schwartz said there are various possibilities for new products, for example, a higher loan-to-value tranche and a leveraged product. This is where lenders’ money invested would be matched with cheaper leverage which would then boost their rates, but that would acquire quite a “few hoops to be jumped through with the Financial Conduct Authority”, he added.
He said that he was pleased Loanpad reached profitability in June, after aiming to do so by the second quarter, and revealed that the platform is working on a software upgrade to reduce the minimum reinvestment criteria down to one penny to boost investor returns.
“We launched in 2019 and since then have been growly steadily and Covid came a year after we launched and caused a slight bump, but we managed to see through that quite well,” Schwartz said.
“And since the first couple of months of Covid it’s been steadily growing month-on-month to where we are today…
“We’ve been profitable since June I think of this year which is a big weight of all of our shoulders because it means the business is no longer burning cash and the need to raise additional capital is no longer a problem for us.
“We did a raise earlier this year on Seedrs to give investors a chance to join the equity, so in the last three months we’ve been profitable.”
Schwartz said Loanpad continues to “grow steadily” and is aiming to increase its investor base by several hundred million pounds.
“We’ll just keep going,” he said.
“I think we’re just at the tip of the iceberg. In terms of the lending side, we could have a number of new lending partners, we currently have around £40m under management and I think we’d be able to increase that to several hundred million without too much difficulty doing what we are doing.
“Whether we can go on at that level of investment on the other side is another question, I don’t see why we shouldn’t be able to.
“If you look at some of the main P2P players, Zopa ,Funding Circle, RateSetter, I think they were touching a billion plus in retail funds so I think there’s plenty of room for us to continue growing…
“We have huge room for growth on the lending and investor side. We continue to grow steadily.”