Encash (YES-secure)

Encash is the rebranded name of YES-secure and was relaunched in 2012.  YES-secure is from the company that operates YES-pay.  It uses a listing style approach pioneered by Prosper in the USA where borrowers can provide information on the purpose of the loan along with their financial information.  Encash will group the borrower by risk category from A* through to E.  They facilitate both personal and business loans.

Lenders are charged a 0.9% annual fee, and borrowers are charged several fees, including an application fee (unlike any other P2P provider).  Lenders are also able to sell their loans at more or less than face value on a secondary market for a 1% one-off fee.

Unique selling point

Encash allows lenders to invest in higher risk markets unlike other P2P companies.  As such lenders are able to set their rates as high as 18% AER.  Encash also operate a social model of connections between lenders and borrowers, however it remains to be seen how this of benefit.

Competition

As Encash is operating in both peer-to-peer and peer-to-business arena, and is the fifth largest provider, but currently has less than 0.5% of the total market.  As well as competing with all of the peer-lenders, YES-secure would be competing with the high street banks, building societies and online lenders.

Comments

The rebranding as Encash isn't simply cosmetic, but there have been improvements to the underwriting which was clearly broken with YES-secure.  Communication has still been very patchy in terms of responsiveness on the forums and replies to emails, with some emails being ignored, and no replies to questions raised on the forum.

There have not been any defaults of loans originated under the Encash brand, but it is far too soon to draw any conclusion.  The maximum lending rates in some markets are such that higher rate taxpayers would be better off leaving their money in the bank with the current predicted bad debt estimates.  These comments should also be taken in conjunction with the bad debt warning below.

General	Communication		2/10
	Ease of Web Site		6/10
	Innovation		5/10
Lending	Lending Rates		3/10
	Fees		6/10
	Access to Funds		7/10
	Bad Debt		5/10
Borrowing	Loan Rates		3/10
	Speed of Loan		4/10
	Fees		3/10
Overall			4.4/10

For an in-depth analysis and comparable statistics please refer to the comparisons of the peer-to-peer companies.

In summary if you are prepared to accept the higher risk of bad debt as a lender and don't pay income tax, or are prepared to pay the higher loan rates as a borrower, then Encash could be for you.

Bad debt warning - bad debt can take months to years to materialise, and therefore the actual bad debt figure may not be fully representative, especially when a company's loan book is growing at a significant rate (for example for the first two years Zopa bad debt was 0.05%)

Encash review written by Ian Gurney, last updated on 1^st February 2013