EXCLUSIVE: Sourced Capital acquires Peer Funding and gains direct FCA approval
Sourced Capital will “very soon” resume peer-to-peer regulated lending after it completes the acquisition of P2P platform Peer Funding and becomes directly authorised (DA) by the City watchdog on 1 February 2022.
Peer Funding will now trade as Sourced Capital, the subsidiary of Sourced Group which provides asset-backed P2P property development investment opportunities to sophisticated, high-net worth, corporate and institutional investors.
Since 26 February 2021, as an appointed representative (AR) of Rebuildingsociety, Sourced Capital has been unable to do any new regulated P2P lending, after the City regulator expressed concerns around the AR/principal structure for P2P platforms.
Over the last year, Sourced Capital has continued to repay all its lenders, work on credit management and go through stringent Financial Conduct Authority (FCA) checks in order to acquire Peer Funding and become directly authorised.
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Derek Pratt (pictured), commercial director at Sourced Capital, said this included looking at the platform’s track record of full repayment of all capital and interest and all loans being on target, and added that new investment opportunities will be on the platform “very soon”.
He told Peer2Peer Finance News that Sourced Capital will launch a new platform and website to coincide with its acquisition of Peer Funding, which had no legacy, loanbook or reputational issues, but had just not been active for “a while”.
Sourced Capital said that the FCA approval will allow the platform, which launched in 2019, to develop new innovative products and opportunities and help it to increase funding lines to the Sourced Franchise network of property developers, which has doubled in size over the past year.
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“We will be able to recommence regulated P2P lending under our own guise rather than as an AR,” Pratt said.
“We wanted to go down the DA route and be on that side of the process and fully regulated and offer investment opportunities to qualifying investors with that rubber stamp of the FCA having gone all over our procedures, capabilities and proven track record, which is massive for us.
“We’re delighted with it, it took a huge amount of work and effort to get where we are, supported by great people inside and outside of the business. We have big growth plans.
“We wouldn’t be doing this if we didn’t have ambitious but realistic growth plans. For us it’s about carefully controlled consolidated growth.
“The first transaction will be on the platform very soon. We absolutely have all of that in place. There is a pipeline of opportunities siting there waiting for this to happen.”
Pratt added that he wants to grow in a “controlled consolidated way”.
“This is a long-term plan with constant gradual improvement and growth and we don’t want to lose the grip of quality of the process,” he said.
“We launched a whole new website and platform to coincide with this. A lot of preparation work and effort went into it.
“The fact we’re moving to become DA, we had to get in there and change some of the content around who and what we are, it just seems a very sensible time to bring it right up to date where we want it to be.”
Sourced Capital said it would like to thank Berman Solicitors, Thistle Initiatives, Peer Funding, and the FCA for their support.
