FCA reportedly set to lift HNW Lending restrictions
HNW Lending has been allowed to reopen its platform to new retail investors, according to peer-to-peer lending research firm 4th Way.
4th Way said the Financial Conduct Authority (FCA) has removed a regulatory restriction placed on the P2P lender in July, which said it could not promote or accept any new applications for lending from retail investors.
Ben Shaw, chief executive of HNW Lending, told Peer2Peer Finance News at the time that he was unable to comment on the reasons for the restriction.
However, it is believed the FCA wanted to understand the platform’s business model better.
The P2P lender lets borrowers apply for loans from £30,000 to £3m secured on assets such as property, cars and fine wine.
But 4th Way suggested the FCA is unfamiliar with HNW Lending’s style of P2P lending as it relies on the value of the asset, doesn’t categorise loans by the likelihood of them going into default and doesn’t have a large number of historical loans to base forecasts on.
The restriction is still listed on the FCA register as of 29 October but 4th Way has said it is due to be removed after HNW Lending made several changes to information provided to lenders on risks.
“4thWay has seen examples sent to individual lenders that clarify and add to previous information; for example, about the risks,” an update from the analyst said.
“This is part of the changes that HNW Lending have made to satisfy the regulator.”
Read more: HNW Lending ready to resume new loans
A separate company called HNW LoanCo has also been set up to offer loans outside of the regulated space.
Unlike HNW Lending, HNW LoanCo will not offer Innovative Finance ISA-eligible investments.
“HNW Lending had been nervous about writing new loans during the lockdown period and its immediate aftermath,” Shaw told Peer2Peer Finance News.
“However, now that we have seen the property market bounce back strongly, we have completed a couple of loans recently and now have a good set of loans in the pipeline.
“The FCA said it can take a few days for the register to be updated.”
Read more: Investors will look to IFISAs when the pandemic ends
