LendIt highlights

By Luke O'Mahony

LendIt Europe is one of the largest conferences for the peer-to-peer lending industry, and this year’s London event attracted some interesting speakers.

We don’t usually cover conferences on our blog, but at this particular event there were a few talks that gave useful insights for investors. Three that stood out were:

Lord Adair Turner on non-bank lending

Lord Adair Turner, the former head of the Financial Services Authority (now called the Financial Conduct Authority, which regulates our industry), made headlines in February when he predicted that there would be significant losses from peer-to-peer lending.

Lord Turner has now made an about-turn, noting that peer-to-peer has the potential to be a “stable and secure” sector, with platforms already showing that they can perform credit analysis “at least as well as banks”, while providing better customer service.

You can watch his speech here.

Christopher Woolard on regulation for the peer-to-peer lending industry

Christopher Woolard, Director of Strategy and Competition at the FCA spoke about the regulator’s approach to the peer-to-peer lending industry, and what to expect in the future.

He said that the FCA expected to complete its authorisation work for the major platforms “pretty soon”, and that a feedback statement on responses to the post implementation review of P2P lending rules will be published by the end of the year.

Click here to see the speech.

Rhydian Lewis on the cost of certainty

RateSetter CEO Rhydian Lewis gave a keynote speech explaining an important difference in what banks and P2P lenders are fundamentally seeking to deliver.

Banks seek to guarantee safety of deposits – a guarantee which carries a significant hidden cost, driving down returns – but despite this objective, the system inevitably breaks down periodically, as it is simply not sustainable to fund risky assets while guaranteeing to keep capital safe. P2P lending on the other hand, is optimised to provide value and the direct delivery of returns to investors for an acceptable level of risk.

Watch Rhydian’s speech here.