OFF3R, an online marketplace for alternative investments, published a report on P2P lending and crowdfunding last week. OFF3R said that while equity crowdfunding sagged in January – dropping 65% from December – P2P lending remained strong.
The Index includes six different equity crowdfunding platforms. OFF3R said that economic and political uncertainty may have played a role in the sectors decline. The authors also posited that perhaps equity crowdfunding platforms will “change focus” and push further into more sophisticated audiences and away from the crowd to better manage industry challenges and sector growth.
Regarding P2P lending, OFF3R covers nine UK platforms in their Index. According to their numbers, these nine platforms lent a total of £294 million in January 2017, an increase of 6% versus December 2016.
OFF3R stated that historically low-interest rates are helping to drive investor interest in P2P lending assets as their risk-adjusted returns are appealing. OFF3R said this is highlighted by the fact that the Index platforms lent 50% more money in January 2017 compared to the same month in 2016.
OFF3R anticipates that P2P lending growth will be further fuelled by the major platforms beginning to offer their Innovative Finance ISA products as we head towards the end of the tax year.
“The increase in the number of providers being able to offer their Innovative Finance ISA products comes just in time for the end of the tax year. We anticipate that this will help to drive P2P lending growth and crowd bond industry and take the asset class more mainstream,” stated James Mackonochie, OFF3R’s co-founder.
The OFF3R Index includes equity crowdfunding platforms Seedrs, Crowdcube, Syndicate Room, Angels Den, Envestors and The House Crowd. The P2P lending platforms included are Zopa, Landbay, RateSetter, ArchOver, Marketinvoice, Lending Works, Funding Circle and Thin Cats.