Peer-to-peer and peer-to-business lending have emerged as growth markets as cash-rich individuals and advisers have recognised the value of lending to people and companies with the means to repay loans, as ISAs, pension funds and savings account returns have dwindled in the recession.
To date around £360m has been lent through the market where lenders spread their risk by lending small amounts to many businesses that meet their risk appetite.
Managing director Daniel Rajkumar explains:
“Lending to businesses is a market gathering momentum as it’s a short to medium term investment that adds diversity to an investment portfolio with high returns.
“Lenders on rebuildingsociety.com are lending money at rates in excess of ten per cent, which is a rate businesses are prepared to pay as they can’t access the funds through banks, despite being profitable and mature.
“If advisers have clients sitting on cash in low interest savings accounts, they should consider lending to businesses through rebuildingsociety.com as a way of better deploying that capital and this incentive shows we’re prepared to pay for their trusted advice as we build the market.”
