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LendMe rebrands, takes on Australia with bank boss at helm

Borrowers who are having trouble getting lending from mainstream banks are seeking alternatives, such as peer-to-peer options, one provider says.

Thursday, July 6th 2017, 7:26PM

by Susan Edmunds

Peer-to-peer platform LendMe, now renamed Zagga, offers secured loans between $25,000 and $2 million.

It has so far processed more than $5m of loans in New Zealand, on average worth $350,000 each, with a term of two years and a loan-to-value ratio of 55%.

Investor returns have varied from 6.44% to 11%, after fees, a year.

Chief executive Marcus Morrison said the platform had seen a change in the market as banks tightened their requirements.

“We’ve been noticing an increase in desire in the market, particularly where borrowers have time pressure, banks are finding that difficult.”

He said the new name better reflected the company’s direction as an investment vehicle and marketplace lender. It is also expanding its target market, to appeal to financial advisers and high-net-worth investors.

“We’re not just about secured lending; we offer investors the opportunity to earn an income by investing in debt products. Traditionally investors have had five main vehicles for their savings – cash, term deposits, managed funds, the share market or property. But something we are seeing is that investors want yield from a product that they can understand, and where they can balance their risk and reward.

"Currently, rates are low, managed products are expensive, who knows where the stock price might be when you need to sell, and not everyone can afford to own their house and a rental property where they might have to wait 20 years to cash out on it. This is why we like to say, why zig when you can Zagga?”

Zagga has launched in Australia, where it has lent $7m in a matter of weeks, Morrison said.

“Given the size and scale of the Australian market, Zagga’s focus there will be on high-net-worth investors and financial advisers. While the scope is bigger in Australia, the fundamentals are the same, with all our loans secured against borrowers’ assets, which are mostly first mortgages over property.”

In Australia, Zagga is headed up by Peter Clare, former chief executive of Westpac New Zealand.

Tags: financial advisers investment LendMe Peer to Peer Lending

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Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
AIA 4.55 3.19 3.19 3.49
AIA Special - 2.69 2.69 2.99
ANZ 4.44 3.15 3.25 ▼3.39
ANZ Special - ▼2.55 ▼2.69 ▼2.79
ASB Bank 4.45 3.19 3.19 3.49
ASB Bank Special - 2.69 2.69 2.99
Bluestone 4.44 4.44 4.44 4.44
BNZ - Classic - 2.65 2.69 2.99
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.25 3.29 3.59
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union South 5.65 4.75 4.75 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 4.35 4.45 -
HSBC Premier 4.49 2.60 2.65 2.80
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 3.99 2.58 2.68 2.79
Kainga Ora 4.43 3.29 3.39 3.85
Kiwibank 3.40 3.40 3.54 4.00
Kiwibank - Capped - - - -
Kiwibank - Offset - - - -
Kiwibank Special 3.40 2.65 2.79 3.25
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Lender Flt 1yr 2yr 3yr
Resimac 3.49 3.45 3.39 3.69
SBS Bank 4.54 3.29 3.19 3.49
SBS Bank Special - 2.79 2.69 2.99
The Co-operative Bank - Owner Occ 4.40 ▼2.69 ▼2.75 ▼2.99
The Co-operative Bank - Standard 4.40 ▼3.19 ▼3.25 ▼3.49
TSB Bank 5.34 ▼3.35 3.49 3.79
TSB Special 4.54 ▼2.55 2.69 2.99
Wairarapa Building Society 4.99 3.75 3.99 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - ▼2.55 2.69 2.79
Median 4.55 3.19 3.22 3.39

Last updated: 10 July 2020 9:02am

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