RateSetter is 5 years old!
By Luke O'Mahony | Wed 7 Oct 15
By Luke O'Mahony | Wed 7 Oct 15
A few brave pioneers liked what they saw, and gave RateSetter an opportunity to show that there is a simple way to earn a better return on their money. Five years later, RateSetter is a dynamic marketplace of over 26,000 investors and 159,000 borrowers, which has delivered over £815m in loans to individuals and businesses. In total, investors have earned £25m in interest by using the platform.
But what persuaded the first investors to come on board, and what do they think of their decision five years on?
Chris Kelly, angel investor:
Chris Kelly, who is an angel investor in RateSetter, also became one of RateSetter’s first investors when he set up an account in October 2010.
“I had been introduced to the founding team through friends, and thought that the idea behind the business – matching investors with borrowers and allowing them to agree a fair rate – was so intuitive. It frustrated me that returns on saving products were at historic lows, while personal loans were still expensive. I also loved the novel concept of the Provision Fund to protect investors.”
“I tend to leave the money I have on RateSetter to reinvest at the market rate, but I love the transparency of the markets, and the fact that anyone can see the money being matched in real time if they want to. It’s a simple product, but if you want to look at the detail, that’s all there too.”
Ralph Wopshott, trader:
Ralph Wopshott is a 31 year old trader living in south London.
“When I opened my RateSetter account, I was saving for a house and was looking for a better rate of interest at a time when rates were low. I was prepared to take on a little more risk, but didn’t want to lock my money away for long periods of time, so I invested in RateSetter’s monthly product, and I managed to reach my goal. I like the fact that it’s easy to make deposits and withdrawals, and also the transparency – it’s easy to see who’s borrowing on the platform. It just feels like a pleasant way to invest money.”
Michael Del Mar, semi-retired:
Michael Del Mar was one of RateSetter’s first investors, opening an account in October 2010.
“I wasn’t investing for anything in particular, just looking for a better rate. Over the five years I’ve been investing, rates on the platform have been significantly higher than any other non peer-to-peer offering, and I consider that the product comes with a manageable level of risk. For me, RateSetter has done precisely what it has set out to do.”
Peter Philpot, retired:
Peter Philpot is a retired paper and board merchant from Essex.
“I took early semi-retirement in 2006 and had a part-time job with time on my hands so I started looking for better ways to use my savings. However, rates started collapsing all around and as I needed a little income I looked around and in 2010 dipped my toe in what was then a new platform called Ratesetter.”
“What do I like about RateSetter? Ease of use, ease of access to repayments - should I need to draw down a few hundred pounds one month, I can do so. And of course higher returns than high street savings products – much higher.”
“I’ve actually referred a couple of new customers to RateSetter and they have been very pleased. One lady had £5,000 she wanted to save but wanted to know that she could get it back in three years. We set her up by putting her money on the three year market with repayments recycling into the one year market, all to be reviewed annually. She was very happy as her cash had been earning 0.25% in a bank savings account. After about fifteen months she had an unexpected expense on her home and needed £1,800. She asked me where to go for a loan – but I said it would be better to sell out £1,800 of her Ratesetter money – she did so and was very pleased that it only cost her £7.00 to do so. Better still, she now thinks – A) – RateSetter is wonderful and – B) I am wonderful too!”
Top five highlights
Over the last five years, RateSetter has succeeded in reducing the cost of borrowing and increasing returns for investors, empowering borrowers and investors to decide the fair level for interest rates. But what are the top five highlights?
To celebrate our fifth anniversary, we’ve launched our best-ever referral deal: if you refer a friend to RateSetter and he or she puts in £500 or more, you’ll each get £50! To get started, head to the Earn Extra page and you'll be prompted to log in. You’ll see five ways to refer others, so pick the one that works best for you and you’re away.
RateSetter’s products are investments as opposed to savings, so don’t benefit from FSCS cover, although we do have a Provision Fund to help protect our investors. Capital is at risk, but with that risk comes substantially better returns.
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Here's where you can view, select and compare previously matched market rates on RateSetter. Also, check out our default and coverage ratios and see a guide to matched volumes over time.