Proplend attended LendIt Europe for the second year in a row and 2015 definitely showcased the growth within the Peer-to-Peer Lending sector over the past year.
LendIt Europe shifted from a one-day event with a few sponsor stands to a multi-level conference with up to 50 sponsors and exhibitors from 45 countries. This shift brought in many more platforms but also delivered more engaged and knowledgeable investors and speakers.
Proplend CEO, Brian Bartaby, was asked to speak on the Property Panel alongside LendInvest, LandBay and Funding Circle. Together they discussed the current status of their platforms, borrower and investor needs, as well as the future growth within the sector. A video of the panel discussion can be found HERE.
Proplend was featured in the LendIt blog, Why the Tranche Model works for P2P Lending. To read the post click HERE.
You can also review a more in-depth White Paper on Why Commercial Real Estate Debt is the Perfect Partner for P2P Lending. This white paper is featured on the LendIt.co press page.
We also participated in the Company Presentation portion of the conference. During the presentation, Brian introduced the platform and outlined our Proplend Tranche Model, a model we believe has produced one of the safest P2P Investments available. The presentation will be made available online shortly, please check back.
The team also had a stand that was continuously busy with investors and others looking for more information.
Key Takeaways
Innovate Finance ISA
When it was announced that the Innovate Finance (IF) ISA was launching in April 2016 the P2P lending sector celebrated, so it was no surprise that during LendIt there was an entire panel discussion devoted to it. The panel included representatives from The Investment Association, RateSetter, Zopa, EY and the law firm Ropes & Gray.
With the ISA being one of the most popular savings products available, it is clear that the Peer-to-Peer Lending sector has built a strong reputation and earned its right to become mainstream. The sector had been lobbying for the ISA for some time, and the IF ISA showcases the significant growth and success amongst the investment community.
Below are some quotes from the session:
“For the Government to bring in the Innovative Finance community through the IF ISA is a real vote of confidence” – Imran Gulamhuseinwala, Ernst & Young
“Obsession with investment for income will provide demand for the IF ISA” – Jonathan Lipkin, The Investment Association
“IF ISA presents perfect middle ground between cash and stocks and shares investments” – Ian Cruickshank, RateSetter”
There is still much to discuss and more developments to come; however, we are looking forward to being able to offer our Proplend investors ISA investment opportunities.
UK Government
MP Harriott Baldwin was the Keynote speaker on Day 2 of LendIt. The keynote speech was centered on the UK Governments Approach to Innovative Finance & P2P Lending, and she made it very clear that the Government is supportive.
As the Economic Secretary to the Treasury, Mrs Baldwin announced that in her role she has set out a very simple and compelling vision that Financial Services have to deliver for customers in the UK. She then focused on 3 Factors creating specific opportunities for us in the UK:
- Technology
- Rapid change is happening in the UK and we must harness the power of technology in the Financial Services sector
- Tech companies innovate and provide opportunities, jobs and growth expansion
- The Government’s ambition is for the UK to be the global hub for FinTech
- Radical Changes for Savers
- Baldwin wants to give savers more freedom to use the money they’ve earned in the way that works best for them, “It is your money, and you should get to choose how to spend it.”
- There is an increase in Pension flexibility and a fresh wave of customers who are more informed and keen to exercise their new powers, which is a real opportunity for Financial Services
- Create Choice & Competition in the Retail Banking Sector
- More competition means banks will be incentivised to offer the best possible opportunities and services
- The new law, which makes big banks share credit data on small businesses, allows Alternative Finance companies to compete and make effective lending decisions.
Our main take-away is summarized in the following quote: “The UK has the technology, the customers and a Government keen to encourage competition.” Harriott Baldwin, MP
Transparency, Security and Regulation were also consistent topics during the conference.
Balance sheet risk was discussed and we agree with Samir Desai of Lending Circle, who stated “the lenders that lend their own money will, when their backs are against the wall, inevitably suffer from a temptation to keep the most attractive loans on balance sheet.” Proplend does not take balance sheet risk.
The need to continue to build trust with both retail and institutional investors was also echoed throughout. Cormac Leech of Liberum Capital outlined specific regulation priorities that include: fraud risk, fee transparency and management incentive agreement.
It is anticipated that next year’s LendIt Europe could be double the size and we at Proplend are looking forward to continuing to contribute to an evolving and exciting Alternative Finance sector.
