RateSetter U-turns on new George Banco arrangement

In May, the peer-to-peer platform announced it planned to enter into a new arrangement with the guarantor loans provider.

Under the arrangement, RateSetter investors would lend directly to George Banco borrowers. 

This was a change from the previous agreement which saw RateSetter investors lend to George Banco, which then would lend the money to its borrowers.

However, RateSetter has decided against the new arrangement after further examination of the infrastructure required to do this.

“…We concluded there were better uses of our development resources which may be deployed more effectively to source other borrowers,” stated RateSetter in a blog post.

“Therefore, we will not facilitate lending directly to George Banco’s customers, and accordingly we have updated our principles of lending document which sets out our lending criteria.”

The existing wholesale loans to George Banco will continue to be repaid in accordance with the schedule of existing loan contracts.

The total of these existing loans currently stands at £31.5m. 

Pictured above: Peter Behrens, co-founder of RateSetter