BondMason, an online savings and investments platform that sources investments from across the peer-to-peer (P2P) market for its clients, has reportedly announced it is officially shutting down its P2P lending business.
Launched in 2015, BondMason claims it makes it easier for investors to target gross returns of up to 8%+ p.a. by enabling clients to invest in direct lending the “smart way.” Since its launch, clients have notably invested in property developments worth more than £100 million and the platform also provides insights, analysis, and access to investment opportunities related to UK residential and commercial properties.
According to Financial Times, BondMason sent an email out to customers on Wednesday and revealed it is stopping new investment offerings and winding down its service upon collecting on its existing loans. Stephen Findlay, CEO of BondMason, stated in the email:
“I feel strongly that it is better to stop our clients investing their funds now and collect the underlying loans, which continue to perform in line with our expectations and past performance; than write a letter in 2-3 years time to explain disappointing returns.”
Findley reported that BondMason was working on an alternative property based investment service. He also revealed to the media outlet that the platform was experiencing increase costs, which includes regulatory, compliance, and client acquisition costs. He then added:
“Clients would have been getting a return in the realm of three to four percent which we didn’t feel was commensurate with the risks they were taking. Some of the operators that have failed in the recent past are also then creating a burden for this left in the marketplace.”