As with most forms of investment, peer-to-peer lending carries a degree of risk to your capital; in this case, if the borrower is unable to repay their loan. At Assetz Capital, we seek to reduce this risk to our investors by taking asset security on every loan, with the added benefit of a discretionary Provision Fund for some of our investment accounts. Investment Account target interest rates should be considered along with the relevant Investment Account expected defaults & losses information. Past performance does not guarantee future performance. We recommend that prospective lenders read the Key Investor Information pages before investing.
At Assetz Capital, we believe that it's important for prospective investors to understand how peer-to-peer lending works, what the risks are and what you can do to mitigate them.
There is always risk in lending money for interest returns. The risk you face in lending money is that if the borrower cannot repay the loan, you may lose some or all of your capital. However, we take asset security on every loan, so that if a borrower does default, investors should expect to recover some or all of any loss through recoveries from the security pledged by the borrower.
Your tax liability
The return you receive with us on your investment is paid gross. No tax is deducted “at source” by peer-to-peer lending platforms. Our lenders are responsible for the payment of any tax due of them to HM Revenue & Customs. Tax will be payable at your marginal rate. We are not able to offer specific tax advice so we recommend that you consult a tax adviser if you are uncertain about the treatment of your investment returns.
Your likely actual return
Rates of loan interest / investment return on our web site are shown as gross rates. We do not charge fees to our lenders currently but you should make allowances for tax and expected default rates and losses (please see below) when calculating your likely net return. This will allow you to make a more meaningful comparison of likely actual returns to other forms of investment.
It is important for our lenders to be aware that, like all peer-to-peer lending platforms, we fall outside of the scope of the Financial Services Compensation Scheme ("FSCS"), though we are regulated by the Financial Conduct Authority ("FCA"). This means that, should a peer-to-peer lending platform fail for any reason, those investing (lending) directly via the platform would have no recourse to the FSCS.
Lending carries a risk of loss in the event of default, so we have a model which indicates expected defaults and losses on our platform.