PEER-TO-PEER business lender Crowdstacker has ditched its charge for transfers, meaning investors no longer pay any fees for using the platform.
Until now, investors had to pay £15 to transfer their loan to other lenders if they wanted to get out of a holding before the underlying loan matured.
“Why should investors have to pay to lend their money to businesses?” said Karteek Patel, chief executive of Crowdstacker.
“Despite being a major driving force behind the movement towards greater transparency in financial services, many alternative lenders, including the large well-known brands, still persist in charging investors.”
An active business lending opportunity on the Crowdstacker platform on Thursday gives investors the chance to lend to Authentic Alehouses for a minimum of £500. Before dropping its fee structure, a minimum amount investor would have had to pay the equivalent of three per cent of their investment in fees to get out of the loan before its three-year maturity.
“Fees may seem like a small cost at, for example, around one per cent, but unless these are totally removed a platform can’t really claim to be making the investment process as transparent as possible,” said Patel. “At the heart of this is the belief that people shouldn’t have to pay to invest their hard-earned cash.”
Crowdstacker was one of the first platforms to launch its Innovative Finance ISA in April 2016. The platform revealed last month that its investors are putting an average of £7,000 into the tax wrapper.