While specialist P2P lending rating agency 4thWay has recently revised its platform rating system, it certainly hasn’t revised its opinion of Proplend – Tranche A loans are top rated and still “astoundingly attractive for the risks involved”.
Proplend now sits in second position among all platforms rated on 4thWay’s Peer to Peer Lending comparison table – a one place rise following 4thWay’s change from a 5 plus to a 3 plus risk-reward scale.
And the commercial property-backed lending specialist ‘celebrated’ this renewed advocacy in late June by taking its borrowing facilitated total over £40m – still with no defaults or investor losses to date.
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To put a 3 plus ‘Exceptional’ rating in perspective, Proplend is one of only 10 providers with the maximum rating – with other UK platforms rated, excellent, fair and a number ‘not rated’ (not passing 4thWay’s standard tests).
Whilst any plus rating should be considered as a good investment on the new basis, the quality of Proplend’s security and excellent interest rates were cited as reasons for the 3 plus award for both their Classic account and tax-free Innovative Finance ISA.
The top rated P2P platforms were separated in the 4thWay comparison table by a corresponding risk score out of 10 – 1 being the lowest risk. Proplend’s “fantastically low” 3/10 score for its Tranche A, up to 50% LTV investments, only bettered in 4thWay’s opinion by one other Peer to Peer provider.
Naturally, with higher loan to value exposure and correspondingly higher returns, Proplend Tranche B and C investments have a higher 7/10 risk score – the same as Zopa Plus but with significantly higher returns after bad debts are taken into account. Or as 4thWay put it – Proplend B and C loans “are still top-rated loans”, just not quite as impressive as Tranche A
For quick comparison with other asset classes, a risk score of 1 is reserved only for cash savings products, where there is no capital risk. 8-10 are generally associated with stock market investing including Stocks and Shares ISA. Peer to Peer lending with Proplend therefore offers a choice of relatively low risk, inflation-beating returns via Tranche A investments – or higher risk-adjusted returns, still considered lower risk than a share portfolio via Tranches B and C.
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Whether scrutinised against Basel-style, severe recession and property crash test conditions, or simply compared to the traditional low-return or high volatility cash and stock market options, Peer to Peer lending and IFISA represent increasingly mainstream and proven investments.
Proplend’s “fantastically good security” and choice of LTV-based investments continue to stand out from the crowd however 4thWay have evaluated its proposition. Why not take a few minutes to register for a Classic account or ISA today and evaluate our investment opportunities for yourself.
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Want to find out more about P2P Lending and the Innovative Finance ISA?
We have a raft of information available about peer to peer investing in our Investor Help Centre. Alternatively, browse our comprehensive IFISA guide to find out more about tax-free investing through a flexible ISA.
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