PPI mis-selling checklist

If you can answer ‘no’ to one or more of the following questions, then you may have been mis-sold PPI.

If the insurance was optional, was that made clear to you?

Did the adviser tell you about any significant exclusions under the policy – for example, the exclusion that says you won’t be covered for any pre-existing medical condition?

If you took out a loan or finance agreement, did the adviser make it clear that you would have to pay for the insurance up front in one single payment?

If you had to pay for the PPI as a single payment, did the adviser make it clear that the insurance cost would be added to the loan and you would be paying interest on it?

Single premium PPI insurance normally only lasts for five years. If your loan or finance agreement was for longer than this, did the adviser make it clear that the insurance would run out before you had finished paying for your loan or finance agreement? The adviser should also have told you that you would continue to pay interest on the insurance premium, even after the insurance expired.

If you bought PPI after 14 January 2005 did the adviser try to persuade you to take it out by saying something like ‘we strongly recommend that you consider taking out PPI’? If so, the sale counts as an ‘advised’ sale and they should have issued a ‘demands and needs statement’ to show why a particular policy has been recommended and why it is suitable for you. If they didn’t, this is grounds for complaint.

If you can answer ‘No’ to one or more of the following you may have a case for compensation. Call Neil on 028 302 57000 for a consultation.

London can breathe easy – it will continue to be the financial lungs of Europe, according to Barclays chief executive Jes Staley.

While he admits the bank may have to move some activities to bases in Dublin or Germany, he believes that most of their European banking business can continue to be done from the UK. “I don’t believe that the financial centre of Europe will leave the city of London. There are all sorts of reasons why I think the UK will continue to be the financial lungs for Europe”

He admitted that other European capitals had been heavily courting the bank to move operations their way. “It’s very interesting that one minute no-one wants bankers in their back yard, the next they are inviting you over to a barbecue.” His commitment to the UK will be welcomed by the Prime Minister, Theresa May, and the Chancellor, Philip Hammond, who will address delegates at Davos today.

It comes 24 hours after HSBC said it would move 1,000 jobs to Paris and UBS said it would shift up to 1,000 jobs to Europe after the government resolved it would be leaving the European single market. Theresa May will be meeting big Wall Street bosses while here today, including Lloyd Blankfein of Goldman Sachs and Larry Fink of giant asset manager Blackrock – both card carrying members of the “global elite” she has been so scathing about.

Barclays is the world’s biggest underwriter of European government bonds and it seemed to many watchers that it might be difficult to continue that activity outside the European single market. Mr Staley said he believed that changes in the legal structure of the bank – by opening a German branch of its Dublin operations for example – would be enough to satisfy European and UK regulators and be in the interests of European governments.

He was upbeat about the prospects for banks in general. saying that the prospect of stronger economic growth in the US under Donald Trump and an associated rise in interest rates would boost bank profitability. The bank still has an unfinished battle with US legal authorities after it balked at demands from the Department of Justice to pay what it considered unreasonable fines for its role in the subprime mortgage crisis.

It is choosing instead to fight the US government in court. Mr Staley insisted that the change in administration (and a new attorney general) in the US was not part of their strategy. “We will still be facing the same prosecutors but we believe in the US justice system to deliver a fair outcome.” You don’t take the US government to court unless you think they are being very, very unreasonable.

What are Debt Based Securities? Lenders receive a non– collateralized debt obligation typically paid back over an extended period of time. Similar in structure to purchasing a bond, but with different rights and obligations.

The debt–based securities market grew by 63 per cent in 2014 Online debt–based securities in renewable energy projects grew by 63 per cent in 2014 to £4.4 million in total financing. The average deal size for debt–based securities is £730,000. On average, it takes 587 investors to fund a renewable energy project through debt–based securities with an average investment amount of £1,243.

The survey of 384 investors in debt–based securities shows that they in general invest relatively large amounts. Sixty– two per cent had invested more than £500 with 21 per cent having invested more than £5,000. They tended to invest in single or very few projects with a third having made only one investment and half less than three investments.

This finding however must be reconciled by the fact that debt–based securities is a relatively new model of alternative finance and only a small amount of deals have been offered and funded to date. The focus on renewable energy matters to investors, being local doesn’t Looking at motivations for investing in debt–based securities, the important or very important factor for investors was the opportunity to back green/renewable energy products (92 per cent) and to make a positive social impact (86 per cent).

They cared less about whether the business behind the project was local or not. When asked what they would otherwise have done with the money they invested, a pretty even split responded that they would have either invested it elsewhere (62 per cent) or saved it (55 per cent). Investing in debt–based securities on renewable projects was generally perceived to be a low risk investment option.

When presented with a number of different investment options such as P2P lending, investing in start–ups or the stock markets, only bonds were perceived to be less risky by investors. Funders found their way to investing in renewable projects through a number of channels. The most common of which was online advertising, which brought in a third of survey respondents, with offline advertising and word of mouth also proving important.

Forty–five per cent plan to invest more in 2015 Looking forward, 45 per cent of surveyed investors plan to put more funds through this model in the coming year with 37 per cent planning on investing a similar amount.

What is Reward-Based Crowdfunding?

Individuals donate towards a specific project with the expectation of receiving a tangible (but non–financial) reward or product at a later date in exchange for their contribution.

The reward–based crowdfunding market grew to £26 million in 2014 Reward–based crowdfunding is probably the model that has really captured the public’s imagination and media’s attention, and it is the type of alternative finance that registered the highest usage rate (eight per cent) in our national consumer poll among all surveyed models.

Reward–based crowdfunding has seen a steady increase of 17 per cent in 2014 from £20.5 million in 2013 to over £26 million in 2014. Analysis of transactional data worth over £30 million between 2010 and the first quarter of 2014 shows that the average size of the reward–based fundraising campaign is £3,766 with approximately 77 backers per campaign and an average donation of £48.92.

The average crowdfunding success rate across seven surveyed reward–based crowdfunding platforms is around 35 per cent. On average, a successful campaign took 28 days to reach their funding target. From the survey of 191 fundraisers and 1,128 backers who have used reward–based crowdfunding, it is clear that those seeking to fundraise in the UK through this model are predominantly those in the social sector or creative industries.

They tend to be small operations, often individuals with little trading history and modest if any turnover. They had chosen reward–based crowdfunding as a potential source of finance to have more control over the project (important or very important for 78 per cent of respondents), raise funds on their own terms (66 per cent), to access the non–financial benefits that crowdfunding can provide (71 per cent) and for the transparency (71 per cent) and speed (68 per cent) of the funding process.

Most backers use reward–based crowdfunding to fund people they know When choosing which campaigns to back, more than 60 per cent of backers valued the quality of the idea, the team and knowing their money was making a difference. Funders were also quite influenced by personal recommendations from people they knew. Backers reported that the money they used to fund projects would otherwise have gone towards day–to–day spending, rather than savings or investment.

Very few backers (less than 10 per cent of those surveyed) viewed their support as an investment, but rather as a chance to support worthwhile projects. Aside from contributing funds, 70 per cent of backers also gave non–financial support, usually by promoting the crowdfunding campaign. Eighty per cent of backers would recommend reward–based crowdfunding or a specific crowdfunding campaign to someone they knew.

Many of them (39 per cent) have also used other alternative finance platforms, usually other reward–based crowdfunding sites. Funders tended to have contributed small amounts ( 61 per cent of respondents had in total contributed less than £50 to projects) to projects and had backed only a single project.

Those on reward–based crowdfunding platforms that focused on funding creativity tended to have contributed more and backed more projects. They generally found out about the campaign through social media or direct mailing. In many cases they also had some connection to, or knowledge of, the fundraiser prior to the crowdfunding campaign.

Most backers gave funds to someone they knew at least by reputation, and only 28 per cent had backed someone they didn’t know. Social media and social networks are key to fundraising success The principle difficulties fundraisers faced when sourcing funds were finding backers and developing campaign material.

Corresponding to how backers reported finding out about fundraising campaigns, fundraisers listed social media and their existing social networks as the most effective routes to reaching potential backers, with offline promotion the least effective. Just over half of fundraisers stated they would have been ‘unlikely’ or ‘very unlikely’ to raise funds without crowdfunding, a further 21 per cent did not know if they would have been able to do so or not.

Three in four unsuccessful fundraisers would try it again Those who failed to reach their crowdfunding target put their lack of success down to not getting their community or network sufficiently engaged with the project(rated an ‘important’ or ‘very important’ factor in their lack of success by 80 per cent of respondents), not generating enough momentum in the campaign’s early stages (74 per cent) and trying to raise too much money (50 per cent).

Despite this, three quarters of surveyed fundraisers would try it again or recommend this model to someone else seeking funds. Twenty–nine per cent of fundraisers increased employment after raising finance through reward–based crowdfunding Looking at the impact, 29 per cent of the fundraisers reported an increase in employment, 49 per cent an increase in turnover and 37 per cent a growth in profits since obtaining finance through reward–based crowdfunding.

Two–thirds also reported having completed their project or launched a new product or service and getting more engagement from supporters. Related to this, three–quarters of fundraisers reported that they benefited from accessing the networks of their funders and around the same proportion said their backers provided assistance with marketing and advocacy of the project. Ninety–two per cent of fundraisers would recommend the model to someone else seeking funds The majority (70 per cent) of the successful fundraisers used the model for the first time since the beginning of 2013, providing further evidence to this being a very young market, with lots of people raising money for the first time in recent years. Successful fundraisers viewed reward– based crowdfunding quite positively and 92 per cent would recommend the model to someone else seeking funds. 81 per cent of them would approach reward–based crowdfunding again in the future should they need more finance.

What is Pension-Led Funding?

Mainly allows SME owners/directors to use their accumulated pension funds in order to invest in their own businesses. Intellectual properties are often used as collateral.

Pension led funding is now a £25 million market.

Pension–led funding (PLF) offers SME owners and directors the opportunity to re–channel, and re–invest their pension funds back into their own ventures and companies mostly as working or expansion capital through SIPP or SASS instruments.13 PLF has supplied more than £25 million of finance to SMEs in 2014.

Analysis of data from PLF providers show that the average amount raised through PLF is £70,257. Pension Led Funding is used primarily by small mature businesses Seventy–four businesses responded to our survey of PLF users. The businesses seeking PLF came from a range of sectors with retail, construction, technology and manufacturing among the most prevalent. They are almost entirely small businesses. Seven per cent were sole traders with 60 per cent having five or fewer employees.

Though small, many are not young. Almost half have been trading for more than 10 years with just eight per cent trading for less than three years. Three–quarters had begun using PLF in the last three years. Users of PLF believed it was easier to access funds through the model than through traditional financing channels.

They also value being able to utilise their pension funds (an ‘important’ or ‘very important’ factor in choosing PLF for 66 per cent of respondents) and having more control over their finances (73 per cent). More than half had approached a bank for funding before securing funds through PLF, with less than a third of those receiving an offer of funding from the bank.

When asked how they found out about PLF, the most common responses were professional advisor (40 per cent) and offline advertising (35 per cent). Whilst some respondents found it difficult to find the PLF provider (11 per cent) and to transfer their existing pension across (13 per cent), in general, most of the survey respondents found that PLF was easy to use.

Sixty–two per cent of businesses have seen their profit grow after securing finance through PLF Just over half of the businesses surveyed believed it would have been ‘unlikely’ or ‘very unlikely’ that they would have secured the funds they needed from other sources, had they been unable to use PLF. Since obtaining funding, 62 per cent have seen their profit grow, 59 per cent have increased turnover and 43 per cent have employed more people.

Other reported impacts since securing PLF include improved cash flow (53 per cent) and the launching of a new product or service (47 per cent). Respondents’ view of PLF was generally positive. 81 per cent say they would be ‘likely’ or ‘very likely’ to recommend PLF to a business they know. 79 per cent are ‘likely’ or ‘very likely’ to approach PLF for funds in the future with 66 per cent inclined to do so, even if a bank offered funds on similar terms.

What is equity crowdfunding?

Sale of a stake in a business to a number of investors in return for investment, predominantly used by early–stage firms. Equity–based crowdfunding grew by 201 per cent in 2014 Equity–based crowdfunding, whereby investors can diversify their portfolio and invest in both early–stage (e.g. pre–seed, seed and start–up) ventures as well as growth–stage companies, continues its rapid expansion with a 201 per cent year–on–year growth rate and facilitated £84 milion in predicted total transaction volume for 2014.

Analysis of a dataset gathered from equity–based crowdfunding platforms, covering £37.43 milion transactions from 2011 to the first quarter of 2014 and including 188 funded deals and 23,414 micro–transactions, shows that the average deal size of an equity–based crowdfunding campaign is £199,095. On average, it takes 125 investors to fund an equity deal with the average micro–transaction value being £1,599.

The average age of fundraisers is 43 and the average age of investors is 40. From the investor side, the average investment portfolio size is £5,414 with an average diversification rate of 2.48 (i.e. on average, one investor has invested in 2.48 equity–crowdfunding deals).

Almost 95 per cent of the funded equity–based crowdfunding deals were eligible either for the EIS (Enterprise Investment Scheme) or the SEIS (Seed Enterprise Investment Scheme) schemes. Sixty–two per cent of investors didn’t have previous investment experience Equity–based crowdfunding platforms are proving attractive for both retail investors who are new to venture capital investing, as well as for experienced investors.

62 per cent of the 290 investors surveyed described themselves as being retail investors with no previous investment experience. A sample of data from the platforms shows that the average portfolio size for certified high networth individuals and ‘sophisticated investors’ is over £8,000 in contrast to less than £4,000 for ‘retail investors’. The pitch and the team are what matters to investors not comments by other investors Three–quarters of investors had invested in businesses run by entrepreneurs whom they had no previous knowledge about or connection to.

The most common method of discovering investment opportunities was through browsing the equity–crowdfunding platform, with the least being offline promotion of the investment opportunities. Investors primarily invest through equity–based crowdfunding platforms in the hope of making a financial return (very important to 61 per cent of investors).

Portfolio diversification, the ease of the investment process and the added control over where their money goes was also seen as important or very important to more than 75 per cent of surveyed investors. Few investors came to the model to invest in a family member or a friend or to support a local business. Instead, investors are selecting specific investment opportunities on the crowdfunding platform, with the quality of the team( rated ‘important’ or ‘very important’ by 97 per cent of respondents) and the pitch (96 per cent) named as the most important factors.

External endorsements and the views of other investors on forums were deemed less important. While 66 per cent of surveyed investors identified tax reliefs as an important factor, more than half stated that they would have invested even if the tax incentives were not present, with only a quarter saying they would not have.

While investors often read comments by other investors when making investment decisions, they rarely contribute comments or get in touch with other investors to discuss investment opportunities. The money they use to invest is money that would otherwise have (at least partly) been invested elsewhere (68 per cent of respondents) or saved (44 per cent of respondents). Ventures seeking finance tended to find out about equity–based crowdfunding through online advertising or through the media and press. Over a third had sought funding from friends and family or business angels prior to approaching an equity–based crowdfunding platform.

Forty–seven per cent of successful fundraisers have increased their profit For those who were successful in their attempt to fundraise, the biggest challenges with the process were developing a marketing strategy and a crowdfunding pitch. They reported that finding and working with an equity–based crowdfunding platform was not difficult.

Fundraisers found that funders added value beyond their financial contributions to the business through assisting with making connections to people in their networks (63 per cent of respondents) and providing market validation for the venture (60 per cent). Fundraisers believed that the most important routes to successfully sourcing funders was through their existing social networks and direct mailing.

Since securing funding, 47 per cent of fundraisers have increased profits, 70 per cent grew turnover and 60 per cent of them have taken on new employees. Three–quarters of the surveyed fundraisers have also launched a new product or service and two–thirds have attracted media coverage.

Those ventures that failed to reach their funding target identified that failure to generate momentum in the early stages of the campaign, insufficient support from the platform and not doing enough marketing as factors that led to their failure. Despite this, 80 per cent of them said they would be willing to try it again and half would recommend equity–based crowdfunding to others with the rest unsure.

Half of investors plan on investing more in 2015 Of the 196 active investors surveyed, 85 per cent had made their first investment since the beginning of 2013, with 36 per cent of investors becoming active in the last three months. Around half of the investors surveyed plan to invest more in the coming year with around a third planning on investing the same amount.

Eighty–one per cent of investors state they would recommend equity–based crowdfunding to someone they know, while 75 per cent say they would recommend a specific business seeking investment. However, it is important to note that given the nature of investing in early–stage companies and the relative nascent state of equity–based crowdfunding model, that most equity crowdfunding investors are yet to see what returns their investments can bring.

All successful fundraisers would recommend equity–based crowdfunding to someone else seeking funding and 91 per cent of them state they would approach an equity crowdfunding platform first in the future if venture capital is needed.

What is invoice trading?

Firms sell their invoices at a discount to a pool of individual or institutional investors in order to receive funds immediately rather than waiting for invoices to be paid.

Invoice trading grew by 179 per cent in 2014

Invoice trading provides fundraising opportunities for small and medium enterprises to trade their invoices or receivables at a discount in exchange for the speedy procurement of working capital. In 2014 the sector grew by around 169 per cent and in 2015 it saw a further growth by 179 per cent. The average invoice auction duration is just eight hours with the average traded invoice value being £56,075. In the majority of cases, a trade invoice only takes seven micro–transactions to complete, signifying the participation of high net worth individuals and institutional investors in this model.

A relatively small sample of 24 businesses responded to our survey of users of invoice trading, therefore the results that follow should be interpreted with caution. The surveyed SME borrowers were spread across a diverse range of sectors with ‘technology’ and ‘business services’ being the most common. More than half of the respondents were based in London or the South East but there were respondents from almost all regions in the UK.

The businesses using the invoice trading platforms tended to be small with over 90 per cent of them having fewer than 50 employees. Yet these are not necessarily young businesses. Over 40 per cent have been in business for over ten years. A third were less than 5 years old and almost all had a turnover of more than £200,000 with half having a turnover of more than £1 milion.

Invoice trading is used to raise working capital

The vast majority (85%) of businesses were trading invoices to secure working capital and 43% of them had heard about invoice trading through online advertising.

The speed of the process was what businesses valued the most (with 95% stating it was a very important or important factor), with ease of use (81%), transparency (85%) and flexibility (85 per cent) also registering as either very important or important factors.

Unsurprisingly given the reason for approaching invoice trading, the other important impact for SMEs was an improvement in cash flow, reported by 92% of the respondents stating the effect.

Almost all had approached banks beforehand with only a fifth receiving offers of funding from them. Over half saw it as ‘unlikely’ or ‘very unlikely’ that they would have received finance should they not have turned to an invoice trading platform.

Three in four would approach invoice trading before a bank in the future

Since receiving funding, 90 per cent of the respondents reported an increase in profit, 80 per cent of them saw an increase in turnover and 60 per cent recorded an increase in employment. Almost all plan to approach an invoice trading platform for funding in the future with three in four saying they would do so even if banks were to offer funding on similar terms. Eighty–six per cent are ‘likely’ or ‘very likely’ to recommend invoice trading to other businesses.

What is P2P Business Lending Debt–based transactions between individuals and existing businesses – which are mostly SMEs with many individual lenders contributing to any one loan. .

The market has more than tripled in size since 2013 P2P business lending facilitates secured or non–secured business loans between individual lenders to mostly SMEs. Over the last two years P2P business lending has experienced an impressive growth, with a 288 per cent increase from the £193 million in 2013 to a predicted £749 million in 2014.

This growth can be largely attributed to the strong expansion of existing industrial players as well as the recent proliferation of this business model underpinned with the emergence of many new and diverse entrants into the market.

Lenders are creating large portfolios as lending is split among hundreds of borrowers Analysis of primary transactional data from P2P business lending platforms worth £309 million covering over 3,000 loans and 3.18 million transactions from 2011–2013 illustrates that the average business interest rate paid is around 8.8 per cent. The average P2P business lending loan size is £73,222 and it takes approximately 796 transactions from individual lenders to the business borrower to fund a listed loan, with the average loan being just £91.95. P2P business lenders have, on average, a sizeable lending portfolio of £8,137 spread over a median of 52 business loans.

Manufacturing businesses using P2P borrowing most Of 3,112 P2P business loans analysed, the top three most funded industrial sectors are manufacturing, professional and business services and retail. P2P lending for real estate finance also emerging One of the fastest–growing markets within the P2P business lending model is secured lending for real estate mortgages and developments.

For this particular section of the market, which was analysed separately, we found that the average business loan amount is considerable higher at £662,425 with an average loan term of 10 months. In addition to looking at transactional data from platforms, we also surveyed 1,771 lenders and 323 business borrowers who have used P2P business lending, to attain further insights on their behaviour and views on alternative finance.

The survey results mirror the findings from the platform data with 30 per cent having lent between £1,000 and £5,000 and 26 per cent having lent between £5,000 and £20,000. It is however interesting to note that almost 23 per cent have provided loans in the range from £20,000 to £100,000. Also corresponding to the findings from transactional data from platforms, our survey demonstrates that P2P business lenders do actively diversify their lending portfolios. One in four P2P business lenders has lent to more than 100 businesses, and 45 per cent have lent to between 20 and 100 businesses.

Lenders tend to be older males using money set aside for savings or investment P2P business lending is primarily used by men who are 55 or older. Eighty–three per cent of surveyed lenders, and 74 per cent of borrowers were men. Fifty–seven per cent of lenders were 55 or older.

They were also quite wealthy with a third having an annual income in excess of £50,000. The majority of P2P business lenders learned about this alternative finance model through online advertising (28 per cent) and online intermediaries such as MoneySupermarket (25 per cent).

When budgeting for lending through P2P business lending platforms, it is clear that the money primarily comes from lenders’ investment budget (54 per cent) or their savings (45 per cent). Very few people (less than 2 per cent) have lent money they would otherwise use for day–to–day spending. Lenders are primarily motivated by the financial return available The main reason why people use P2P business lending to lend is to make a financial return on investment, with 82 per cent of respondents stating this as very important in their decision.

Building on this, many also stated the service that P2P business lending offers, in terms of the ease of lending process (important or very important to 87 per cent), diversifying investment portfolios (important or very important to 88 per cent) and having control over where the lent money is going (important or very important to 81 per cent) were key to their decision to lend. Unlike the donation and reward–based fundraising, the opportunity to use the P2P business lending model to support a specific sector or industry, supporting friends and family or supporting a social cause was of relatively low importance to the majority of lenders.

Furthermore, it is interesting to observe that almost none of the P2P business lenders had personal connections to the businesses they lent to, with 97 per cent saying their first loan was to someone they didn’t know. Registered but inactive lenders concerned by business creditworthiness We also asked those lenders who have set up accounts with P2P business lending platforms but have yet to make their first loan (5 per cent of all surveyed lenders) what would make them start lending.

The key issue ranked important or very important by these potential lenders was uncertainty about the creditworthiness of business seeking loans (73 per cent of respondents). Uncertainty about how the model worked was not one of the more cited factors with 35 per cent saying this was ‘important’ or ‘very important’. Inactive members highlighted more information about businesses seeking loans (13 per cent), greater tax incentives (31 per cent) and more information about risks associated with lending (11 per cent) as three key factors that would make them begin lending.

Finally, 58 per cent of the surveyed inactive lenders indicated that they would start lending within the next 12 months. Borrower seeking growth or working capital and value speed of service Businesses seeking to borrow via P2P business lending most commonly seek a loan for expansion and/or growth capital (41 per cent) and working capital (34 per cent). SMEs borrowers often choose P2P business lending because the combination of the speed and ease of use of the model, rated important or very important by 94 per cent and 90 per cent of borrowers respectively.

91 per cent of borrowers highlight how they see P2P business lending as an easier way to get funded than traditional channels (e.g. bank) as a key factor in their decision to choose this lending model. P2P business lending is funding many borrowers who would otherwise struggle Responses show that borrowers in many instances have unsuccessfully sought funding from more traditional funders such as banks before attempting to borrow via P2P business lending platforms.

79 per cent of borrowers had attempted to get a bank loan before turning to P2P business Lending, with only 22 per cent of borrowers being offered a bank loan. 33 per cent thought it was unlikely or very unlikely that they would have been able to secure funding elsewhere had they not been successful in getting a loan through the P2P business lending platform, whereas 44 per cent of respondents thought they would have been likely or very likely to secure funding from other sources had they not used P2P business lending.

Businesses receiving loans reporting growth in term of job creation and turnover Most business respondents have experienced positive growth since successfully securing a loan. 71 per cent of borrowers reported growth in turnover, 63 per cent experienced growth in profit with 53 per cent having increased their employment.

The majority of the remaining respondents reported that their turnover, profit or employment levels had remained largely the same. Less than 5 per cent reported contraction under any metrics. Growth of model likely to continue in 2015 The rapid growth of P2P business lending is illustrated not just by the increasing amount of money lent to businesses via the model in recent years, but also by the number of people and businesses who have only just started to use the platforms to lend and borrow. More than 69 per cent of P2P business lenders surveyed have begun using the model in just the last two years with half of these starting since the beginning of 2014.

Similar trends exist on the borrower side with 48 per cent of the businesses responding to the survey having first borrowed in 2014 and 40 per cent in 2013. Looking ahead, the majority of P2P business lenders expect to increase their lending in total and to more businesses, with 53 per cent of them expecting to lend more, and 38 per cent of them expecting to lend about the same. In addition, 65 per cent of lenders expect to lend more should their P2P lending qualify for the Individual Savings Account (ISA) scheme. Ninety–four per cent of borrowers state that they will be likely or very likely to approach a P2P business lending platform first if they need finance in the future, and a significant 86 per cent would be likely or very likely to approach a P2P Lending platform even if a bank could offer similar terms. Ninety–seven per cent would be likely or very likely to recommend P2P business lending to other business that they know are seeking funding. Current lenders’ support for the P2P business lending model is emphasized by the fact that 59 per cent of lenders are very likely to recommend P2P business lending to others with money to lend, and 42 per cent of them are very likely to recommend P2P business lending to business looking to borrow money.

Royal Bank of Scotland puts aside £400 million to compensate business owners mistreated by its Global Restructuring Group following FCA inquiry.

The Royal Bank Of Scotland (RBS) has put aside £400 million to cover the cost of a redress programme for small business customers of the bank’s Global Restructuring Group (GRG) between 2008 and 2013. The activities of the GRG were investigated by the Financial Conduct Authority (FCA) after a number of former customers complained about the way they were treated. Some of the most serious allegations suggested that RBS moved businesses to the GRG when they did not need support, and that RBS’s actions directly led to the collapse of these businesses.

While the FCA report found ‘no evidence’ to support the most serious allegations it did identify a number of failings from RBS. These failings included issues around customer complaints, communication and charges. As a result of the report, RBS has set up a new compensation process for GRG customers.

It will be led by retired High Court judge William Blackburne. RBS will also automatically refund all complex fees paid by small business customers of GRG between 2008 and 2013. This includes all exit fees, asset sale fees and risk assessment fees. The bank said it will put aside £400 million to cover the cost of this process. Ross McEwan, chief executive of RBS, said: ‘We have acknowledged for some time that mistakes were made.

Some of our customers went through what was a traumatic and painful experience as a result of the crisis. I am very sorry that we did not provide the level of service and understanding we should have done.’ The FCA will publish a full account of its findings once it has considered whether it will take further action. However, it cautioned that as the actions carried out by the GRG were largely unregulated the FCA’s powers were ‘limited’. Credited to: http://citywire.co.uk/money/rbs-apologises-to-small-firms-hurt-by-restructuring-unit/a966640

It’s becoming clear that mortgage mis-selling happened on a much bigger scale than even we imagined. Lots of people were sold mortgage products that weren’t affordable over the long term or that they would never be able to repay – interest-only mortgages are set to become the new PPI – a widespread issue for homeowners across the country.

We’re well placed to help people who find themselves in this position. There are many reasons why lenders and brokers are now being asked questions about who they gave mortgages to and why. If you can relate to any one of these points – you may have been mis-sold your mortgage? i) Were you advised to buy an Endowment policy? If you were advised to get an interest only mortgage and an endowment policy to go with it, you may have now discovered that the endowment won’t pay out enough to cover the amount you borrowed.

You may have been mis-sold. ii) Did you get an interest-only mortgage? If you were advised to get an interest only mortgage, you should also have been advised to how to repay your mortgage after the term of your loan. You should also have been made aware of the difference between the costs of a capital and a repayment mortgage, or that you may have to switch to a repayment mortgage and not rely on increasing house prices. If not, you may have been mis-sold. iii) Did you re-mortgage to clear debts? If you were advised that the cheapest way to consolidate your debts (unsecured loans, credit cards or other finance) onto your mortgage, you may have been mis-sold.

The adviser should have explained that while you may have more affordable outgoings, you would be repaying for longer and also paying a lot more in interest. iv) Did you complete a household budget analysis Were you asked to outline your monthly income and outgoings? Did your advisor work out how much money you have left over at the end of the month? If you didn’t, you may have been mis-sold a mortgage that you couldn’t afford. v) Did you get a self-certified mortgage? If you were encouraged to take out a ‘self-cert’ or ‘fast-track’ mortgage, without having to prove your income with payslips, you may have been mis-sold your mortgage.

Some brokers promoted these mortgages as they paid far higher commissions. vi) Will you still be paying your mortgage after retirement age? For example, if you took out a 30 year mortgage at age 40, did you lender or broker talk about how you might make the repayments in the final 5 years of the term if you had planned to retire at 65? You may have been mis-sold your mortgage. vii) Did you pay a big fee to your broker? Were you made aware of a broker fee that seemed to be quite high? Did you pay it or was it added to your mortgage without you knowing – and so are you paying interest on those fees every month? You may have been mis-sold your mortgage.