Changes to the RateSetter site
We have expanded our range of terms for Borrowers. Borrowers can now borrow up to a maximum of five years.
We have given Borrowers improved functionality for changing their Direct Debit date and introduced a new facility to allow Borrowers the ability to overpay and set up future overpayments all within their RateSetter account.
We have introduced two new markets for Lenders.
1. 1 Year Bond.
RateSetter is pleased to announce the first peer to peer 1 Year Bond. The 1 Year Bond is a fixed interest product with capital and interest paid at the end of the term. The 1 Year Bond is used in tandem with the Monthly Access market to create 18 and 24 month loans. We expect it to be popular with Lenders who are looking to realise an enhanced return with a lower level of access than the Monthly Access option.
2. 5 Year Income.
Our 5 Year Income product is a new term for RateSetter, enabling longer term loans and an anticipated higher rate of return for the lenders than our current 3 Year market. It is managed on the same basis as the 3 Year Income product, with a monthly repayment to the Lender of a portion of capital and interest.
N.B. These products have been reflected in the reinvestment settings page (see below for more information) and throughout Your Account.
To reduce confusion, we have changed some terminology on the site and markets:
Lenders can participate in four Markets
- Monthly Access – formerly Rolling Market
- 1 Year Bond – new
- 3 Year Income – formerly 3 Year Fixed
- 5 Year Income – new
(Calling them “Income” products reflects the amortizing nature of those products, with monthly repayments coming back to the Lender.)
When a repayment is made, the Lender can choose one of three options.
- Reinvest at "Market Rate" (formerly At Best)
- Reinvest at "Your Rate" (formerly Set Your Rate)
- Withdraw to their "Holding Account" (formerly RateSetter Account)
Upgrade of Reinvestment Options.
We have amended the “At Best” and “Rolling Rate” functionality that many Lenders use. We have simplified and shared Reinvestment to apply across all markets. When a repayment is made, the Lender has the option of reinvesting into any market or withdrawing to the Holding Account.
i.e. you can automatically reinvest money from one market to another as it is repaid. Your setting will determine both which market and at what rate you reinvest into.
The Market Rate acts similarly to the “Rolling Rate” but is now applied to all our markets. The Market Rate is set at the level of the lowest Lender offer in the market, after discounting a small percentage of the lowest rate money on offer, to protect against “outlying” offers that might distort the rate. Reinvestments that select the Market Rate can expect to be matched quickly and efficiently at the current Market Rate – this option is for Lenders who wish to ensure that their money is constantly earning a return.
Your Rate will act as a “floor” for an offer. For those RateSetters who want more control, they can set a floor rate for their reinvestments, below which they will not be matched. However, if the Market Rate is higher then the order will be submitted at Market Rate. (Previously a “Set Your Rate” order would be submitted as an order regardless of whether it was above or below the Rolling Rate.) This option ensures you will never be matched at less than Your Rate, but does mean that if Your Rate is higher than the Market Rate, your money could sit on the market not earning interest for a period.
N.B. Each market has an individual setting. Your chosen settings will apply to ALL contract repayments from that market.
All future loan repayments and the applicable payment date are now displayed under each market section in the Your Account section of the website. These are “live” and will reflect any changes in the Borrower’s chosen monthly payment date. (Previously these have only been available by downloading the Payment Schedule of the contract.)
Finally we have reduced the period of the “Rolling Window” from two days to one day – this is the period during which you cannot amend your settings for upcoming Monthly Access contracts.
We hope that you will feel that these new products and changes will enhance your experience of RateSetter. As always, we are grateful for any feedback on all and any aspect of our business. Please contact us if you have any comments.
We thank you for your continued support.
The RateSetter Team