What happened last month in P2P finance and crowdfunding? Which platforms are on the rise and which ones are falling behind? How has the sector performed over the last 12 months? We take a look at numbers reported to P2PMarketData in March 2021 and dive deeper into this month’s special focus: a rebound of the British P2P lending sector in the first quarter of 2021.
About the monthly report
In the Monthly Funding Report, we track the funding amounts of real estate crowdfunding, peer-to-peer & online marketplace lending platforms. Please note that:
- The statistics exclude some prominent platforms such as Lending Club, Funding Circle, Credimi and Prosper, which do not accept individual investors and remain open only for institutional and corporate investors.
- None of the numbers cited is an estimation – the amounts are reported directly to us or pulled from the platforms’ publicly available loan books and statistic pages.
- We convert all amounts to EUR for comparison reasons, using exchange rates from the last day of the month.
- Historical funding volumes reported below may divert slightly from volumes calculated in previous reports due to exchange rate fluctuations and the changes in the pool of platforms we track.
We currently track data from 84 participating platforms, including originations operating in 27 markets and with 12 different currencies. In March 2021, we welcomed another well-established, high-volume player and Swiss market leader – CreditGate24 (you can read the latest CreditGate24 review here) as well as a newcomer from Bulgaria – Afranga, which just launched in February 2021. Zopa withdrew from the report, explaining to us that, having grown their banking product substantially, there is more sensitivity to what information they can share as a bank.
Key highlights: What happened in P2P finance last month?
We recorded a total funding volume of €516m in March 2021. Looking at the main currencies, funding in EUR accounted for almost three-fourths of the total amount. Marketplace lending was the most popular investment type – close to half of all the investments were made on loan-aggregating platforms.
Chart 1. Funding volumes by currency and funding type (€ million)
We also reported several noteworthy milestones reached last month:
- Latvian business lending platform Crowdestor has crossed the €50m total funding barrier;
- Mexican personal lending platform Yotepresto has funded over 1 billion MXN worth of loans (roughly €42m); and
- Belgian SME-focused platform Look&Fin has broken above the €100m threshold.
Considering the broader picture, the recovery from the sharp drop in spring 2020 accelerated. Compared to the previous month, we noted a sharper increase in total funding volume (up from €419m), driven largely by the rebound of EUR-denominated investments. Overall, the monthly funding volumes have more than doubled since the slump in April, although they still haven’t reached the pre-pandemic levels (over €750m in January last year).
Chart 2. Funding volumes over the last 12 months (€ million)
Big player ranking
Below, we show the 10 platforms that raised the most capital in March 2021. Mintos topped the ranking once again. Besides, Italian business lending platform Borsa del Credito made a considerable gain and, most spectacularly, EstateGuru made a great comeback to the top 10 by funding twice as much compared to just a month before. Our newly added player – Swiss CreditGate24 also joined the ranking and is one of just two non-EUR platforms in the top 10 (the other one being British RateSetter).
Together, the 10 leading platforms accounted for more than 70% of the total monthly volume we recorded, while the top 5 – for almost 60%.
Chart 3. Platforms with the highest funding volumes in March 2021 (€ million)
Rising star ranking
Here, you can see 10 platforms that have grown the most over the past 12 months. US-based crypto lending platform MyConstant and Irish marketplace Lendermarket remain the fastest-growing platforms. The remainder of the top 10 comprise is dominated by real estate (4 out of 10) and business lending (2 out of 10) platforma.
Chart 4. Fastest growing platforms in the last 12 months (%)*
Below, we show the reverse of the rising star ranking – 10 platforms that have noted the slowest growth in the last year. DoFinance remains at the top following its disturbances during the COVID crisis – we wrote about this in the last month’s report. Contrary to the rising stars, the slow movers tend to be marketplace or personal lending platforms (6 out of 10).
Chart 5. Slowest growing platforms in the last 12 months (%)*
A deep dive: A 2021 rebound of the British P2P lending
By the end of 2020, the outlook for peer-to-peer lending in the UK looked rather grim. After initial recovery from the bottom was reached in spring, the volumes started to decline again in the second half of the year, reaching another major low point in December, even as total EUR volumes kept creeping up. Yet, the new year brought new life to UK’s platforms. While the markets in continental Europe were slowing down, the funding volume for GBP-denominated loans shot up in January, almost doubling the December volume. Growth continued throughout the first quarter of 2021, albeit at a much more moderate pace.
Chart 6. GBP funding volumes over the last 12 months (€ million)
Will this upward trend continue for GBP-denominated P2P investments? It’s difficult to say at this point. P2P lending may play an important role in supporting economic revival in the UK, which is emerging from lockdown more quickly than its European counterparts. One survey’s results from January 2021 suggest that the British are ready to invest more in P2P finance but are awaiting signs of a recovery, such as the vaccine rollout and job security. On the other hand, earlier this year, the British regulator – FCA listed P2P lending as a high-risk investment, following a series of supervisory cases and consumer alerts regarding many distressed P2P lending platforms, which may limit appetites for this asset class. We will keep an eye on how peer-to-peer lending develops both in the UK and continental Europe in the following monthly reports. Stay tuned!