LendingCrowd suggests investors move their uninvested funds
LendingCrowd has said investors should “strongly consider” moving their uninvested funds to interest-bearing accounts.
The peer-to-peer business lender is currently closed to retail investors due to its involvement in the government emergency lending schemes and said in an update last week that it has no immediate plans to reopen the loan market.
This means investors earning interest from pre-pandemic P2P loans cannot automatically reinvest their funds.
“Lenders with a cash balance in their LendingCrowd account should strongly consider moving these funds into an alternative interest-bearing account, such as a bank account, as per guidance provided by the Financial Conduct Authority,” LendingCrowd said in a blog post.
“Interest repaid into a LendingCrowd account and not lent out does not earn interest.”
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The update said LendingCrowd continually monitors the performance of borrowers and the underlying economic conditions.
“If we identify an opportunity to reopen our loan market, we will consider this carefully and cautiously, within the context of treating our customers fairly,” it said.
It comes as the platform published its outcomes statement detailing its loanbook performance in 2021.
The document showed that investors earned 5.7 per cent from its growth account and 6.5 per cent from its income account against a target rate of 4.6 per cent and 4.2 per cent respectively.
Its default rate ranges from 1.07 per cent for lowest risk loans to 6.08 per cent for the higher risk investments.