Founded in 2014, the business was fully acquired by asset manager Intrivia at the end of 2020 and has increasingly focused on institutional capital to fund its embedded loans in recent years.
Image Source: Loan Works
Lending Works, one of the UK’s oldest peer-to-peer lending platforms, is exiting the retail funding market, citing falling investor demand which has worsened the pandemic.
Founded in 2014, the business was fully acquired by asset manager Intrivia at the end of 2020 and is increasingly focusing on institutional capital to fund its integrated loans.
Nick Harding, CEO and Founder of Lending Works, says the dynamics of the P2P market have changed significantly in recent years, with retail investor participation steadily declining.
“This has been exacerbated by the Covid-19 pandemic, as we believe it is no longer big enough to support a traditional lender such as Lending Works. We now need to use alternative funding sources to ensure we can provide our loan customers with the service they need,” he said.
“As a result, we have decided to close our retail investor product and move to a ‘run-off’ process.
For investors, this means that Lending Works will no longer accept new funds from retail investors. Those who have already invested money in a loan will continue to receive loan repayments until their balance is fully paid off, the company says,
“This is not a decision we took lightly. We are grateful for the role retail investors have played in helping us build an exceptional lending platform over the past seven years,” he added.
The news comes a week after rival Zopa, which invented the concept of P2P lending, said it would quit the peer-to-peer lending process.
You can read more about the trickling process here.