Squirrel Money P2P

[TB@squirrel.co.nz]

How is your secondary market fair to loan vendors who have to sacrifice 1% interest as loan sale fee but still have to wait weeks or months to receive their funds back? Kind of waters down the benefit of a secondary market a lot, with investors not knowing when they'll be able to exit their investment (if at all!)

Banks/finance cos. charge the 1% break/penalty fee too but their redemptions are instantaneous. Your model is different, but Squirrel pitches itself as better than these in the first place to justify its comparatively lower interest rates vs the NZ P2P sector, isn't it?

I think if no acceptance confirmation emails were needed from the investor for making the initial investment in a loan (making your process automatic), then none should be needed for investing in the secondary market loans either (making this process automatic), since you do not disclose loan details at initial investment anyway and acknowledge that credit events and loan terms don't really disadvantage a secondary market loan buyer. In fact, everyone then gets a chance to benefit from an improved rate (rather than just the lucky guy who happened to check his junk mail folder in time). Now that would be fairer, don't you think?

Anyway, good to see that you seem genuinely interested in listening to feedback and making some effort to improve your platform.

Thanks @beacon. Just to clarify, as I stated above, the confirmation email is only required if: 1) the loan has had a missed payment or the like at some point, or 2) the remaining term of the investment is outside of the automatic matching rules documented in the Secondary Market Rules. The first criteria is mandated by the FMA as part of our licence to operate the secondary market - so we have no discretion with that, the second forms part of the rules we thought appropriate when launching the secondary market - so we can and will be amending that one fairly soon to help improve the efficiency of the secondary market.

The point you make about the 'lucky guy who happened to check his junk mail' isn't quite right - the 'lucky guy' as you put it is actually the best matched investor for that investment per the Secondary Market Rules - effectively the investor at the front of the queue - so yes I do think that is the fairest approach and I do not see that changing. EDITED - perhaps we could look at offering it to a larger group, say the top 10 investors in the queue - that would presumably speed up the transfer process.

Finally, the investment propositions and platform functionality available in the market clearly varies between P2P providers and the various financial institutions about – and yes, the rates our investors have achieved may be lower than some others – but ultimately it comes down to investor risk appetite and what features of each platform they value.

We’ll keep working on the resolution for the small number of investments travelling slowly through the secondary market – and I’ll let you all know when its resolved.

All the best with your investing.