Transparency of Lendermarket

Introduction

The goal of Sneakypeer is to make the peer-to-peer lending market more transparent and secure for everyone. To that end, we incentivize P2P and crowdfunding platforms to publish more information, communicate more frequently with investors, and be more responsive. Lendermarket, which has agreed to share some insights and future plans with us, is one of the platforms that has proven to be trustworthy and willing to share more data with investors. In this article, we will take a brief look at Lendermarket, highlighting the platform's positives and negatives as well as potential new developments.

What is Lendermarket?

Lendermarket is an Irish P2P lending platform that connects investors – private persons and institutions – to loans issued by digital finance companies from various European countries. The platform is not regulated yet and the main loan originator partner of Lendermarket is Credistar which shared ownership with the platform. The platform sets a low bar for investment, with a minimum investment of just 10 EUR per loan. With the potential for annual returns of up to 15%, Lendermarket provides an attractive opportunity for investors seeking alternative investment opportunities. Its loan originators are committed to responsible lending, offering skin in the game of 5-10% and a robust 60-day buyback guarantee to ensure the security of investors' funds.

How transparent Lendermarket is?

The P2P platform prioritises transparency by publishing information about its risk control procedures for loan originators and providing information about its selection criteria. While Lendermarket does not publish its historical loan books, it does publish annual financial reports that have been audited. However, the platform does not make information about all team members readily available on its website.

The platform aims to educate its investors on the difference between classic investments and P2P loans. The P2P Lending page on the Lendermarket website provides a comprehensive overview of how P2P lending works and how investors can participate. The platform's blog section, which features Investing Tips and Finance Industry categories, provides educational content on a monthly basis to help investors make informed decisions. The LM Stars section features monthly interviews with experts in the field, offering insights into their investing journeys and the lessons they have learned along the way.

Additionally, Lendermarket is soon to launch a scoring system for its loan originator partners, bringing increased transparency to the platform. Finally, a new educational page has been prepared to emphasise the importance of diversification in an investment portfolio.

Overall, Lendermarket takes steps to provide transparency into its operations and accountability through the information it chooses to share publicly, but there is room for improvement.

What is next for Lendermarket?

The platform intends to make significant improvements to make investing easier and safer, as well as to provide investors with more information to help them make better investment decisions.

The mission of Lendermarket is to increase the number of loan originators on its platform and provide investors with a more diverse portfolio. Since last year, the company has onboarded three additional loan originators and transformed into a marketplace, offering loans from a variety of sources. Lendermarket recently updated its loan originator onboarding process to reflect the regulatory requirements outlined in the European Crowdfunding Regulation 2020/1503.

The platform has prioritised the protection of investors' funds and interests. To that end, the Irish Department of Justice has authorised Lendermarket as a trust service provider. The platform closely monitors its loan originators' financial results, including the NPL ratio, and this information will soon be made public in the form of a scoring method.

The company is currently developing a new platform to address the performance issues with its current platform and provide faster, more stable access to pages and online account statements. The new platform is a significant step forward in terms of technology and is designed to support an improved product with faster deployments, new features, and improved financial monitoring activities.

According to Lendermarket representatives, they plan to publish data on the project owner's credit agreement defaults over the last five years. The company will provide more information on its governance arrangements and legal structure once it has submitted its application to become an authorised provider of crowdfunding services. This includes information about ownership as well as investor equality.

Conclusion

While there is still room for improvement in terms of transparency, Lendermarket is committed to educating and guiding investors through the P2P lending process, as well as making further improvements.  With a focus on increasing the number of loan originators on its platform, protecting investors' funds and interests, and providing a better online experience, Lendermarket is an ideal destination for both novice and experienced investors. The company's future plans include publishing default rates and other important information, ensuring transparency and equal treatment for all investors. Sneakypeer looks forward to these developments.

To find out more about Lendermarket, visit the Lendermarket review by Sneakypeer.