Moneywise and Zopa
Just read this page.
So in terms of trust Zopa rank with the very best when it comes to providing personal loans.
Who says so?
A survey of 12,000 Britons by Moneywise. I suppose it all boils down to how much you trust Moneywise and their methods of doing surveys.
The detailed results are here.
Here’s a couple of paragraphs from the page.
Although there’s the risk of borrower default, lenders benefit from rates that are higher than those on savings accounts, while borrowers enjoy low rates and no early repayment fees.
And the model’s proved a hit with its customers. One describes it as “shaking up financial services,” while another said “it just works. No nasty bankers”. There’s also praise for the service Zopa providers: “They are friendly and care about their members. Service is fast, reliable and efficient.”
Incidentally, Santander and Halifax were rated the worst.
It’s All About The Markets
There is a lot of doom and gloom in the markets, as this report says.
To me the markets have become one gigantic fruit machine, run not for the benefit of the companies and investors, but for the middle men. Did you ever see a financial advisor on a bicycle?
Remember the Stock Exchange was setup originally so that businesses who needed to expand could raise money to do so. Those who invested got a return on their money, with the higher returns coming from the more risky investments. It’s about time the Stock Exchange got back to basics.
An old friend, Phil, long since dead, and myself put forward the principle of a company called Very Dodgy Investments, which would only invest in blue chip stocks like GEC. We never had the guts to start it, but GEC went into melt-down soon afterwards, despite having been one of the most cash-rich and solid companies a few years before.
Over the last few years, I’ve come to the conclusion, that a company is only as good as the person who pulls the strings, no matter what the figures look like. Just as with GEC at its pomp, you might not have liked some of Lord Weinstock’s methods, you couldn’t fault the returns you got by investing. The same could be said of other companies and the people who led or now lead them.
But look at some of the banks of recent years. Someone, often with lots of charisma and no sense, have proved that what goes up must come down and have undone many decades of prudent management. Generally by greed. Whoever said Greed is Good was wrong! Wanting to be rich and then working out how you do it, by perhaps inventing something and/or lots of hard work is good. Provided you don’t step over the line of what is morally bad.
But generally the one group of people you can trust is the men and women on the street. Not everyone has of course a good credit rating, but those that have one can generally be someone, who is worth supporting. This principle has been used by reputable banks and building societies to make money for years. It is even being exploited by the government in turning the bad loans of Northern Rock round. People would prefer to pay their loans rather than lose their house, even when the consequences might not be that bad in all cases of default.
Some companies, like those who charge high rates for payday loans also take advantage of the good nature of the person on the Dalston Omnibus. There must be half a dozen of these companies on the Kingsland Road near me.
This principle is one of the reasons I support Zopa. With them, the element of trust also works both ways and to and from the company.
Lenders know that their money will be lent out at the rate they ask for, but they know if they want a too high rate, the money may take some time to be lent.
Borrowers know the consequences of not paying and generally do pay, although there is a proportion of bad debt. They also know that the terms and conditions are as fair as they ever are in the financial services industry.
But I would never recommend Zopa directly to anyone. Look at the company and understand how the system works. Only when you are satisfied with what you see, should you make a judgement.
But I will say one thing. Put a note in your diary for ten years from now to look at what Zopa has become!
I’ll also say one last thing about the markets. Who tell you to invest in the Stock Market? Journalists, who work for so-called reputable newspapers! And possibly others with similar vested interests, but no money of their own.
You might ask why I invested in Zopa. I’m a Control Engineer by University Education, a Computer Programmer by work experience and someone who likes those behind an idea to have a proven record amongst many things. Zopa ticked all of my boxes and felt it was worth investing the money I got from selling my late wife’s Porsche Boxster. It wasn’t even the world’s third best car anyway!
It’s been a case of so far, so good! But Zopa for me has outperformed the Stock Market.
An Odd Problem With Zopa
Because a lot of people repay their Zopa loans on the first of the month, when the first is at a weekend, these payments get delayed by the banking system by a couple days and I worry that something has gone seriously wrong, as money hasn’t arrived. I just checked and tomorrow is a very big payday – We need to have 28-day months to sort this problem out.
Or I could stop being paranoid.
Who’d Be A Banker?
According to the Telegraph, there are going to be a lot more job losses in the banking industry.
My old friend, David, ‘s judgement gets better. If he was still here now, he’d be surprised that it hadn’t happened earlier.
A Use for a Cheque
I got a cheque today to settle my problem with National Express East Anglia. I’m not a lover of cheques, but this must be one use for them, as they didn’t have my bank details and probably the credit card details weren’t stored either, as it was a transaction in a station.
Incidentally john Lewis give out gift vouchers for small payments and another rail company gave me compensation for a late train in a Rail Travel Voucher. For me neither is a problem, as I go to Waitrose a couple of times a week and I suspect that the Rail Voucher will be used on a trip to see Ipswich Town.
I wonder how long before Universal Gift Vouchers or something similar become commonplace. These would be bar coded and possibly issued to a particular person, very much like the vouchers I buy for The Times. I think some companies already use M & S vouchers in this way.
When I paid the cheque into my account at a branch of Nationwide in Upper Street, the counter was empty, and I joked with the cashier about writing few cheques these days. He agreed that he didn’t either and judging by his expression, he’d done little business that day. Admittedly, it was lunchtime, but all this seems to say that counter service will soon be gone.
We just need to replace the cheque.
Halifucked Or Spam From the Halifax
Over the last couple of days, I have received several spam e-mail from a marketing company, working on behalf of the Halifax. They all offered me a new credit card, which is like offering someone like Andy Murray a new tennis racket, as the ones I’ve got, are perfectly adequate for my modest needs.
So not only do we have bail out this wunch of bankers, but we have to endure their spam in our inboxes. Interestingly, it very much looks genuine and some of it has come to e-mail addresses, I’ve not used in at least ten years. I’ve kept them as spam traps for tossers like these and they’ve worked well.
Interestingly, the Halifax web site appears to have no means of contacting the bank on it, that is obvious to an irate non-customer.
Santander Bring Their Call Centres Back To The UK
This story about Santander seems to be part of a trend, with more and more call centres returning to the UK. What surprises me is that Santander supposedly has 25,000,000 account holders in the UK and it is creating only hundreds and not thousands of jobs by moving the call centres back.
So just how often do we phone our banks? I have phoned my bank twice in the several years I’ve been with them and I’ve e-mailed once about a piece of trivia. I also have phoned a credit card company once, as the card was damaged and I needed a new one.
So judging by the times I’ve called them, I’m fairly typical.
So Santander moving their call centres back to the UK, may be a cynical marketing ploy to try to improve their bad customer service image. But it could really be just a way to reduce their call centre to the size required.
As with the Lloyds redundancies, it will be interesting to see what employee/turnover ratios for banks look like in a few years time.
My guess is that they’ll make huge profits with only a few employees. But on the other hand, people will be very satisfied with customer support, although they’ll probably still complain about getting loans. But then the sensible will borrow their money elsewhere.
“Banking Will Be The Mining Industry of the Nineties”
My old friend and bank manager, David, said that quote about 1995 or so. At the time he had just been promoted to Business Banking Director of Lloyds Bank. One day, I’ll tell everybody about the rest of that lunch, but I suspect that some of the guilty are still involved in banking.
What I would say, and I know others will agree, although one has now joined David as one of the Devil’s right hand men, is that there never ever was another bank manager who was as good as David, when it came to guiding and nurturing companies from inception to stardom. In some ways though, he was a rogue. But he was always a rogue on the side of the angels.
He had seen banks at all levels and knew that they were massively overstaffed and that the only way in his view they could survive and prosper was by cutting out the deadwood. He told me that what had happened to the miners would happen again to workers in the banking industry.
And then yesterday, Lloyds announced a lot of job losses.
So David was eventually right, but he had seen the writing on the wall all those years ago.
Farewell Cheque Guarantee Cards
I moved my account to Nationwide, when Barclays took over the Woolwich some years ago. I never ever used the cheque guarantee card that I received.
So I don’t think I’ll miss the fact that they’ve been abolished.
Will anyone?
Zopa Abandons Listings
Basically, Zopa had two different forms of lending; markets and listings.
Markets work by lenders getting together to fund loans to borrowers. All is done automatically by the computers and risk assessors in the middle.
Listings are best defined like this.
In a nutshell, they work just like an online auction, except that the ‘price’ comes down instead of going up.
Once a listing becomes 100% funded, you’ll see that the overall interest rate will begin to fall as lenders compete with each other to be included in the loan.
I never used them. And as they weren’t as popular as markets and were quite expensive to administer, Zopa have now dropped them.
The Anonymous Widower 