Proplend breaks £100m lending milestone amid borrowing spike
P2P lending platform Proplend announced this week that it had broken through the £100m lending milestone across the platform (£102m as of today), returned over £47m of capital and paid £10m of interest to its Lender base.
Proplend Limited is a fully FCA authorised peer-to-peer lending platform specialising in sub £5m, secured commercial property loans and connects cash-rich, income-poor investors (lenders) directly to creditworthy commercial property investors (borrowers). This process enables investors to earn attractive asset-backed income and by gaining access to commercial mortgage and bridge loans.
Proplend’s founder and CEO Brian Bartaby said of the company’s latest milestone;
“With fewer and fewer banks’ lending into this sector, we have seen an increasing level of loan enquiries from borrowers over the past few months. This is being matched with demand for income from investors who are concerned about volatility in the stock market, dividends being suspended or cancelled altogether and the long-term low interest rate environment. Proplend’s fixed income product is an attractive addition to an investment portfolio with some investors shielding their returns from income tax by investing via their ISA.”
He says the Proplend platform is a repurpose of a long term well-established institutional asset class of Commercial Real Estate Loan Syndication.
“Proplend has just reduced the size of the loans and increased the number of participants in each loan by lowering the barrier to entry. Rather than 3 lenders syndicating a £100m loan, we have 300 lenders syndicating a £1m loan. Our lenders gain access to this institutional style of income stream from as little as £1,000.”
Proplend further mimics this institutional asset class by splitting each loan in up to three loan-to-value based risk tranches which allows lenders with different risk parameters and return requirements to all participate within the same loan. All loans are supported with the security of a first legal charge over an income-producing UK commercial property.
At the heart of this system is a fusion of innovative technology that allows Proplend to efficiently process and execute what have traditionally been cumbersome and time-consuming transactions – using fintech on the lender side of the platform and proptech on the borrower side.
Proplend is a pioneer of the peer-to-peer loan tranche model in the UK, whereby loans are split into up to three loan to value (LTV) based risk tranches. Tranche A 0-50% LTV, Tranche B 51-65% LTV and Tranche C 66-75% LTV. This offers investors with differing risk appetites and return requirements the ability to all participate in the same transaction – more easily identifying investments with risk-reward levels they feel comfortable with.
The platform services two different spheres of clients;
- Commercial property investors (borrowers) – Investors either purchasing or refinancing income-producing commercial investment property who are looking to borrow between £250,000 to £5,000,000 for up to 5 years on an interest only basis.
- Investors (lenders) – Individuals lending personally or via their ISA, SIPP or SSAS and corporate lenders. Each looking to earn attractive rates of risk-adjusted returns of between 5%-12% per annum with a minimum investment of £1,000.
Proplend’s simple, secure and transparent platform connects investors directly to creditworthy borrowers. Investors lend on a deal by deal basis, choosing which loans and borrowers to invest in from those ‘in funding’ and on the Proplend Loan Exchange (secondary market). Investors are also able to lend across up to three loan-to-value based risk tranches – choosing the risk-return level(s) they’re comfortable with the help of the comprehensive loan information made available to them via the Platform.