The research team at Orca published an article in April bringing retail investors the news that Octopus Investments is set to offer a new P2P platform onto the UK market. The first established investment provider to enter the fray, Octopus may well be the catalyst for bridging the gap between the advised market and peer-to-peer lending; something that has been poised ever since financial advisers were giving permission to recommend P2P products in April.
Octopus Choice Purpose
It’s a new asset class and most of the firms in that market are not known to financial advisers and don’t have a proven track record, so we overcome that nervousness to some extent.
Octopus Choice Lending
The website home page opens with the following:
Target interest rate: 5.1% p.a (no fixed)
Borrowers: UK property developers
Security: Asset backed – 62% loan to value (LTV)
Min. investment: £10
Interest repaid: Monthly
Octopus only offers loans that are underwritten by realisable assets. To add a second tier of protection, the P2P platform invests its own funds into each and every loan, taking a first loss position to ensure investors receive loan repayment first in the event of a loan default.
1. Asset backed security
2. Octopus lend with their customers
3. Experienced lending
Octopus Choice will be monitored closely by the peer-to-peer lending market in the coming months and years. The platform is part of an established and revered investment firm that serves financial advisers, primarily. The Choice platform could be the stimulant required to see IFAs start recommending P2P investments to their clients.