Plend - Become Someone’s Lending Hero
Plend - Become Someone’s Lending Hero
This week I interviewed Plend Cofounders Robert Pasco and James Pursaill. Plend is the UK’s first social lending marketplace, allowing people to lend directly to each other at affordable rates.
One big mission of my blog is to showcase those innovating within the alternative finance industry. Plend are in the P2P lending vertical of the alternative finance space, also known as lending-based crowdfunding or crowdlending. They’re utilising the power of open-banking to score the real affordability of the 12 million of us locked-out from affordable loans due to inaccurate, or invisible credit histories.
Thanks so much for your time Plend team!
First up, I want to hear what’s different about Plend - how are you innovating in this space?
We’re different in two ways:
Social Lending - Plend allows borrowers to tell their story to lenders looking to make a direct difference - a real one-on-one connection.
Open-banking scoring - we use new data sources to correctly score previously unrepresentative people in the UK, in particular Gen Y and Z who most likely have thin or invisible credit files.
We are focused on providing a longer-term, lower-cost solution, which is bucking the trend of short-term stop-gap finance (such as Klarna) in the UK. A genuine step up for your finances - instead of risky debt masquerading as store credit.
“We are showing with Plend you can successfully run a P2P lending business that treats both sides of your customer base - lenders and borrowers - with respect and transparency”
What are the biggest challenges you’ve had in launching and growing Plend?
There have been a few for sure!
Initially, it was the PLEND Score (how we rate and select lending opportunities) and how we ensure that it actually makes an impact for our users. We are very lucky to have Kevin Allen on as our CRO, who has a wealth of experience in this field and has launched and assisted some of the most successful consumer lenders in the UK.
The P2P lending sector doesn’t have the best reputation at the moment - it’s a great concept that has been let down by some high-profile failures in management and some cases, outright fraud.
But P2P has revolutionized how we book our holidays (AirBnB), travel (Uber) and even date (Tinder) - so there’s no reason it shouldn’t be the way we lend money to each other as well. We are showing with Plend you can successfully run a P2P lending business that treats both sides of your customer base - lenders and borrowers - with respect and transparency.
What interests me most about Plend is the next-level intimacy of the issuers - you’re funding weddings, new adventures and people’s dreams!
Why did you choose to host these kinds of projects?
Intimate is the word! One advisor called it ‘belly-to-belly’ investing. You are, for all intents and purposes, one person's lending hero.
The truth is the only limit to the loan stories are the ‘Plendies’ themselves. From weddings to work training, debt-consolidation to house deposits, the reasons why people need affordable credit in the UK range from the exciting to the essential.
In the past, people have talked about ‘credit shame’ - that borrowers have been shy or embarrassed about being in debt or needing a loan.
Plend offers the opportunity to re-frame that need - you’re funding someone’s dream as an investor, not giving a handout to an anonymous portfolio. Borrowers tell their own story, in their own words.
And how do you calculate the risk profile of the issuer and therefore the estimated rates of return?
We look at two years of transaction data from a borrowers bank account and analyse their income and outgoings. There are a number of positive weightings - including regular income, net disposable funds each month, and bills such as rent, utilities and charitable donations being paid regularly every month.
There are also a number of risky behavioural traits that we weight against - heavy gambling spend, for example, is often indicative of a risky borrower.
“Plend offers the opportunity to re-frame that need - you’re funding someone’s dream as an investor, not giving a handout to an anonymous portfolio. Borrowers tell their own story, in their own words. ”
So what’s coming up for Plend? How can we support you?
Our first step is our early-access launch, where a select group of borrowers will launch their campaigns on the marketplace, and lenders will be free to invest in whichever story - or rate of return - they are most attracted to.
We are now launching in the next couple of months - if you’re interested in investing with impact, or you’re looking for an affordable loan and want to tell you story, sign up to our early-access list today - https://www.plend.co.uk/join-us
Amazing! And finally, who are you excited about in this space? Who else should we be watching out for?
Big shout out to SoLo Funds - who are pioneering the social lending, opening banking model over in the States with great success. They’ve just closed $10m in funding for their Series A and are currently doing over a thousand loans each month. Solo proves that the Plend model works - and we can’t wait to bring it to UK borrowers who deserve better rates, and lenders who want to make a difference with their money.
Thanks so much Plend! I love what you’re doing and look forward to hearing of your launch 🚀
Sign up to Plend’s early-access list today - https://www.plend.co.uk/join-us