Ratesetter, a leading British peer-to-peer lending company, has left P2PFA, the peer-to-peer lending industry’s trade body in the UK, after being accused of attempting to hide bad loans from investors, The Times writes.
Membership requires adherence to the P2P Finance Association Operating Principles including transparency. No customer has experienced any loss from our actions but we recognise that our actions breached the principles of the Association.
Crowdfundinsider, a leading title in the alternative finance industry, reports that Bruce Davis, Director of the UK Crowd Funding Association (UKCFA), previously issued a statement regarding the RateSetter challenges:
This underlines why we need clarity from the regulator about the scope of loans based crowdfunding. The UKCFA represents members from loans and investment based crowdfunding and have always advocated maximising transparency for lenders and investors so they have a clear understanding of where their money goes, the risk it incurs and how the rewards are shared between platform and lender. RateSetter have done the right thing to acknowledge their errors but the industry must not lose sight of the benefits of simplicity and transparency.