EasyMoney pays back £10m of interest to investors

Peer-to-peer property lender EasyMoney has returned £10m to investors since the platform opened to the public in February 2018.

This follows the news that the platform has passed its £150m lending milestone, just four years after the company’s launch. Investors have never lost a penny of their money and there have been no defaults to date.

Jason Ferrando, EasyMoney’s head of lending, believes that the platform’s popularity is partly due to the fact that it pays “very good rates” and takes a smaller margin than some of its competitors.

“We’ve got a blended rate that we pay out to our investors,” he says. “If you add them all together, the actual blended rate is around seven per cent.”

EasyMoney has a tiered structure of returns where the more you invest, the higher the return. An investor who places £100 with the platform will receive a return of around three per cent, but this rate goes as high as eight per cent for those professional investors who can invest £1m or more.

Ferrando estimates that the platform has around 60 professional investors.

“Our investors range from the £100 first-time P2P lender, to a professional investor who has £5m invested in our loans,” he explains. “I think the average investment is about £19,000 per investor.”

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Around one third of this money has been invested via EasyMoney’s Innovative Finance ISA (IFISA). Ferrando says that March and April are the busiest times for the platform, as investors seek to use up their annual ISA allowance before the end of the tax year. However, he adds that EasyMoney “has had many busy times”.

“Lockdown was actually really good for us,” he says. “While a lot of our competitors really suffered, we made a decision to stay open and keep trading as normal, which ended up being the right move.”

During the first lockdown in March 2020, EasyMoney had a series of discussions about whether to continue accepting retail funds.

“In the end, we decided to stay open,” Ferrando says.

“And it worked out really well because even though we were seeing a huge amount of money being withdrawn, we wanted to save money coming in. That was where our networks really did become a big help because when everybody was withdrawing, our experienced P2P investors saw the opportunities available and began investing more.”

EasyMoney tells new investors that they may have to wait a month for their funds to be invested, so that they have plenty of time to source the highest quality loans. This is due to the platform’s stated priority to never write a bad loan.

Ferrando notes that this commitment to quality loans has seen many investors reinvest their returns into the next available loan.

“The hardest task of any platform is to actually make the investor happy,” he says. “So, it’s quite amazing that the investors want their money invested as soon as they’ve sent it into their account which is almost impossible to do.”

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