PROFILE
can struggle with the scale required for secondary markets due to their smaller pools of loans and investors. Ablrate’s secondary market is exceptionally active especially given the firm’s fairly short history and modest size – no less than £33m of the total lending to date of £44m has been traded on its secondary market so far. “Most platforms don’t have a very good secondary market – they are clunky and often not really a market at all,” Bradley-Ward says. “But ours is hugely liquid, it allows platforms and investors to rebalance their portfolios.” So when events such as the Brexit
vote, for example, result in some investors wanting to exit some of their loans, they can – so long as there are others ready to take them on. “Those who are risk averse have been able to take their money out, while those who are prepared to take a little more risk have come in,” Bradley-Ward adds. Its success sparked Bradley-Ward’s big idea to take on not only the incumbents of big finance, but also to help smaller P2P platforms cooperate in the face of increasingly asymmetric competition from the big three in the market – Funding Circle, Zopa and RateSetter.
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In partnership with tech provider ASMX, Bradley-Ward is developing a blockchain-powered secondary market system aimed at providing platforms with more liquidity, thus widening the appeal of P2P to both smaller investors and institutional money. “If you’re only doing a million a month, you’re not going to get any institutional money simply because you are not doing enough,” he asserts. “We can’t all be Funding Circle, but 50 platforms operating together can be Funding Circle. That’s why we want ASMX to be that central cog.” Ablrate and its partner business