Crowdstacker: Peer-to-peer lending and borrowing
Is the alternative peer-to-peer finance platform the right provider for you?
Crowdstacker is a peer-to-peer (P2P) lending platform with a difference. The company specialises in providing business loans to already established businesses. The fact the loans are to more established businesses should reduce the risk of default, and could make it a viable option for those looking for an income investment product.
Continue reading to find out more about the P2P lending platform.
What is Crowdstacker?
Crowdstacker was founded in 2014 by Karteek Patel, Mark Bristow and Julian Turnbull. The company’s founders have worked together for over a decade, and combine a huge wealth of knowledge and experience from the finance industry.
So far, Crowdstacker has raised over £36m and has roughly 7,000 members. The loans are exclusively to established companies, so the risk of default on the loans should be relatively low.
How it works
To start investing on Crowdstacker, follow these simple steps:
- Open your account: Open your account in as little as a few minutes
- Select: Select a business you would like to invest in
- Invest: Invest as little as £500 in your chosen business
- Earn: Receive payments monthly, quarterly or yearly
- Get paid back: Get paid back your principal amount either during the loan or at the end of the term
To raise funds on the Crowdstacker platform, the process is a little more complex. It will involve meetings with directors, a due diligence process and a review of the financial position and business plan.
Benefits to investors
The benefits of lending to businesses through Crowdstacker include:
- Investments are transferable on Crowdstacker’s secondary marketplace
- Multiple tranches on products, so you can start earning interest sooner
- Investments are eligible to be held in the new Innovative Finance ISA, a Crowdstacker P2P account or a P2P SIPP.
Benefits to borrowers
Raising funds on the Crowdstacker platform comes with a number of benefits, these include:
- Your business will be one of a few, and wont be competing with a big crowd of businesses
- All products are debt based, so you will not lose a share of your company when raising finance
- Multiple closings on products, so you can start using the proceeds sooner
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