P2P Money Blog

There has been significant activity on the Encash / YES-secure forum recently in response to the reduction in maximum lending rates to a level where lenders could be losing money.  However despite this, there has been no response from the company on either the forum or a response to emails sent by P2P Money.

Lenders appear to be withdrawing funds and even moderate lending requests are going unfulfilled, unfortunately to the detriment of the potential borrower who have to pay a non-refundable fee of £5 to be listed.

Here are some of the most recent comments on the forum.  This post was written by phltrnr:

There has been a great deal of activity on the Forum from many lenders and borrowers too but notably, Chandra has been conspicuous by his absence.

I ran a successful small business for many years and my maxim was "The Customer is King" whereas here, I feel that we are being treated with contempt as the management of encash have not even deigned to grace us with their presence to try to defend or justify their actions. It seems to me that they are hoping that, given time, it will all blow over and we disgruntled lenders will start to lend again.

Two weeks ago I expressed my dissatisfaction with the new rating structure and announced that I would withdraw £100 every week until the situation was rectified. Having made two successive £100 withdrawals without any input from Chandra & Co I have finally lost patience and am going to withdraw the whole of my encash account balance - nearly £1300, and I'll withdraw payments from borrowers as they come in - some of them at the old rate of 35% - Yes 35%, it's not a typo!

There are many other options e.g. tax-free ISAs offering 3.5% easy-access or 4.5% fixed, without the risk of late payments or defaulters to worry about.

Here is the follow-up from Leodensian:

I've already retrieved my 4 figure lending balance and it was credited to my bank account yesterday.
This plus more will probably go on some share dealing. I could return it in minutes using my card but won't be doing so until the rates are reverted or the suggestions of "paulnkaty" are adopted. Chandra & co may well wish to be Ostriches but I can't see this issue going away anytime soon !! All they will do is damage the reputation of the site and upset both borrowers and lenders alike.

Here is another post from paulnkaty with some statistics:

Over the last month further tightening of underwriting policy has been done at YES-secure and it now seems that the average rates offered are too high to attract sufficient number of better credit rated borrowers to match with lending funds available
The above is the first part of the statement by chandra at the very start of this thread, further tightening of underwriting may have been done, but one month to ensure the tightening of the underwriting has been sucessful (or not) is not long enough to be proven without doubt this needs to be tested for 6 months min.
As for rates being too high to attract the sufficient number of better credit rated borrowers, well chandra you have had a couple of weeks to find one or two now so where are they??
Then chandra you say that the new better rated borrowers are needed to match with the lending funds available, well these funds available two weeks ago were at a high of £107,000 this has fallen to £89,000 (and still dropping!!) DO YOU really think that the new rates have worked??
Almost every request continues (and will continue) to go unfunded, borrowers are leaving as fast as lenders, the number of requests are falling day by day!!
The quality of the requests that now rarely come along are the same payday loan culprits we always had, those that happily paid over 1000%, but you think will find 27.5% excessive??
wake up chandra and face the real world and your lenders and lets get things back on track before lenders invest elsewhere, borrowers take loans elsewhere [snip]

Encash / YES-secure published their core values which are:

1. Keep things simple, upfront and transparent
2. Keep innovating for consumers' and businesses' benefit
3. Maintain trust and security
4. Maintain high speed efficiency
5. Keep improving through regular feedbacks

Lets hope that Encash / YES-secure can live up to their core values and provide high speed feedback to lenders, otherwise the trust will continue to ebb away.

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