Investing: get the full picture before you risk peer-to-peer

Platforms such as Zopa offer higher rates than banks and building societies for those ready to take chances

Are your savings at risk of being overthrown by dark forces, never to be seen again? Marc Chagall’s La Révolution and Raoul Dufy’s Les Régates (The Regatta) and were allegedly pledged as security on FundingSecure, a peer-to-peer platform that promised small savers returns of 16% a year. But the company collapsed in October, putting at risk £80m of savers’ cash. The art dealer who pledged the works – but appeared not to physically hand them over – simply sold them to someone else.

Peer-to-peer (P2P) lenders promise better interest rates than the banks, using the internet to link up savers with prospective borrowers. Zopa, RateSetter and Funding Circle are the biggest players, and account for the bulk of the £6bn that will flow through P2P platforms this year, according to data from Brismo and Link Group.

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from The Guardian https://ift.tt/2s6TI9E