We are delighted to answer any questions you may have. Below are some frequently asked questions. Please contact us if you can't find what you're looking for
An overview of BondMason
BondMason enables clients to target an 8.0%+ p.a. gross return before fees from P2P loan investments. We want to make it easy to invest across the best the P2P market has to offer; providing a convenient service from a team that you can trust.
You may find the following articles helpful to begin with:
- "How it works" an overview of investing through BondMason.
- "Three tips for sucessful P2P lending" reviewing platforms and selecting loans to target a return of 8.0%+ pa.
- "About Us" meet the team, and see our code of ethics.
- "How to target a 8.0% p.a. return" the technical details and calculations that enable clients to target a 8.0% p.a. return.
Your money is sent to a segregated client bank account held with Barclays. This money is ring-fenced from our own money.
From there, your money is used to purchase Receivables in accordance with your settings. Each Receivable is given a unique reference code in our transaction database; and these records are backed up in four different locations. You can see a summary of your investments on your dashboard at any time - and can choose to hold, liquidate or sell any or all of your holdings at any time.
BondMason clients include individuals depositing from as little as £5,000; through to companies and institutions investing much more than this. We can't provide advice on your individual circumstances - please speak to your financial advisor for advice, to decide if BondMason may be suitable for you.
Sadly we can't accept any investors based in the US, or that are US taxpayers. But please contact us if you are based in the US, or a US taxpayer - as we may change this policy in the future
A Receivable is a set of cash flows. Purchasing a receivable means that a buyer is able to access a set of cash flows from the seller of the Receivable.
For example: a seller may sell a Receivable for £100 on January 1st, which entitles the buyer to a cash flow of £108 on December 31st. This gives the buyer access to an 8% p.a. return.
We need basic personal information to set up your account, including address and date of birth. In addition, you need to supply either a passport number or drivers licence number for additional security.
In some circumstances we may seek further information before we can set up your account. We will contact you within 24-48 hours if this is the case.
On the "Set Your Preferences" step of the sign up process, you have three options to choose from. These are:
- Autobid: you can choose to invest automatically across all the Receivables available on BondMason. Most clients choose this option.
- Auto Re-invest: you can choose for your returns (interest and capital repayments) to be automatically reinvested into new Receivables.
- Investment concentration: you can choose to spread your full allocation across a minimum of 50 or 100 Receivables.
Each is explained in further detail in the panel next to each option. By selecting the Information icon you can see further details with relation to each
The best way to open an account is to wire funds to the BondMason Client Account, using your personal reference code (which you will be given during sign up). A faster transfer is fine, and this should be free for you (depending on your bank) - there's no need to spend £25 for a same day transfer.
Please contact us if you have any difficulties doing this, or would prefer to pay in a different way (debit card, cheque etc). We reserve the right to pass on any 3rd party bank fees associated with these payments - but we will contact you in advance to give you an estimate in each case
Every client gets a personalised dashboard, with a summary of their investment performance, updated daily and containing high level detail on every underlying loan investment.
- Loan investment detail includes:
- Amount: the amount you have invested in that loan investment
- Rate: the interest rate on that loan investment
- Term: the remaining months for that loan
- Borrower type: whether the loan has been made to a company (corporate), individual (consumer) or against an asset or property
- Investment status: whether the loan is performing or in default
- Loan reference: the reference number relating to the underlying loan
- Receivable reference: the reference number relating to your portion of the underlying loan
Clients are able to target a gross return of 8.0% p.a. This is after defaults and losses, but before tax and fees
Since we started investing in April 2015, clients have achieved an average gross return in excess of 8.0% pa net.
Interest is paid to your account as soon as it is received and processed by us for each Receivable:
- BondMason have an automated 'bridge' to two-thirds of our P2P platforms - so the paid interest on the underlying loan is then processed into your corresponding Receivables and generally processed and available as cash in your account within 24-48 hours;
- For the other one-third of platforms, there may be up to a 3-5 day lag, before the interest is marked as paid as cash into your account - however, if you close your account then everything is brought up to date for that day
Capital is either repaid during the life of the Receivable ("amortising") or all at the end of the Receivable ("bullet" repayment).
Small fluctuations from day to day can be explained by how Accrued Interest is converted into actual Cash Interest:
- Accrued interest on your account is based on a calculation of the interest rates on each underlying loan and the estimated repayment date
- The actual amount of interest received can be different to the actual amount of interest estimated: for example the borrower may repay early
- When we process the loan repayment information - which may have a processing delay of 2-5 days depending on when we are notified by the underlying third party platform - the estimated accrued interest is then converted into actual paid cash interest
- This conversion can lead to a small decrease or increase in your overall balance. But you will always see an increase (only) in the amount of cash interest in your account
BondMason carefully selects and diligences the best P2P Platform partners that originate loan positions and receiviables for sellers' of Receivables. We aim to enable clients to achieve an annual gross return of 8.0% p.a. This is after defaults and losses, but before tax and fees – clients have achieved a gross return in excess of 8.0% p.a in each of 2015, 2016 and 2017 to date.
Platform selection: we only approve direct lending and P2P Platforms partners if they can demonstrate a good track record and experience of sourcing and pricing credit; and a sound set of processes to manage borrowers. We conduct our own analysis and diligence on each platform before enabling sellers to sel Receivables across BondMason from the underlying loans.
We have aproved less than 1 in 4 of the UK’s P2P Platforms.
Loan investment selection: from our panel of approved P2P platforms, sellers source loans which have an appropriate risk-return profile to suit clients needs. There is a bias toward asset-backed loans which can demonstrate characteristics of minimising any expected losses in the event of default. Please see our statistics page for more details.
What happens to my money: your money is held in a segregated client account with Barclays. It is kept separate from BondMason Ltd's own bank account. In the event of platform failure; your investments will still continue - as the Borrower will still have an obligation to repay its Lenders - and we will work with any platform to ensure this is repaid.
None of the P2P Lending platforms are covered by the FSCS. However, cash waiting to be invested is held in a segregated bank account with Barclays, which is protected by the FSCS.
BondMason is not regulated by the FCA, however we have an application pending with the FCA for certain additional permissions.
We aim to do everything we can to protect your funds, and safeguard your account with BondMason. This includes adopting a best of breed approach, working with trusted data centre providers and running regular (and multiple) backups and protecting client data.
If you become aware of a security breach, or potential security breach, please contact us immediately.
No. But some of the underlying third party platforms do, as well as credit insurance policies, and these can serve to protect certain investments.
However, we don't tend to value protection or provision funds. We understand that they may be helpful to smooth performance over time, but the underlying economics simply aren't attractive to a well diversified investor (in our opinion). Considering the three possible outcomes:
- The Protection fund is set at exactly the right level, at which point it effectively crystallises the loss ratio up-front, impacting IRR;
- The Protection fund is too big, in which case the loss ratio is over-accounted for, dampening returns;
- The Protection fund is too small, in which case the investor is exposed to losses anyway, which could also result in platform failure, and the IRR has been reduced.
Put simply, in some cases a provision fund may protect you from some capital losses, but in almost every case this protection will be outweighed by how much you have to sacrifice your return. For a well diversified portfolio, as long as you recognise you are likely to incur some losses against the attractive interest rates received, then you shouldn't want, or need, a protection fund.
BondMason has a "living will" procedure; which means that a third party will step in, and manage out all remaining client positions and funds. Ensuring client funds are returned as underlying loans are repaid.
We pride ourselves on enabling you to get access to your money when you want it. We aim to enable you to liquidate your Receivables in full, and return your funds within 14 days, if not faster. It can take longer though. On average, clients have been able to fully liquidate their positions within 24-48 hours.
The precise time taken to liquidate your investment positions and return your funds depends on how much you are withdrawing in total. We are unable to guarantee how long it will take in each case. Please see our article on Liquidity for more information.
Fees: 1.0% - 1.5% p.a.
We charge a single fee, which is calculated daily based on the amount of capital invested through BondMason. In most cases investors won't feel the impact of this fee, as BondMason is often able to access the same loans at higher interest rates than standard investors. And loans which are not available to most retail investors. Please refer to our fees page for more information.
Normally nothing - it's free to withdraw funds.
We reserve the right to charge a fee of between 0% and 2% when you withdraw your funds - depending on how much you have outstanding and how quickly you would like your investments liquidated. This fee is only charged in exceptional circumstances - for example, if a user is repeatedly withdrawing funds and reinvesting (i.e. short term trading) - which our system is not designed for. In the unlikely event that the withdrawal fee is charged, we will contact you in advance of any such fee being charged.
Please do not hesitate to contact us on 020 3126 6705 or email@example.com if you can't find an answer here.