Ablrate P2P Investor Review – A Real Investor Experience (Updated July, 2019)

By | 14th January 2019

Summary: Ablrate offer some of the largest returns in the P2P sector, and offer a somewhat different type of loan relative to the competition, with the assets often being business assets as opposed to property. There is some evidence that their due-diligence and communications are above average, although with a smaller range of borrowers the loans are of higher risk and it can be harder to diversify.

Here is how Ablrate compares with similar platforms dealing in business loans:

PlatformLinkTarget Rate (%)My XIRR (%)Current (%)Live Rating
ReviewUp to 15%11.8%11.3%4/5
ReviewUp to 7%8.23%8.2%2.5/5
ReviewUp to 5.3%TBC5.3%3/5
http://www.huddlecapital.comReviewUp to 16%8.0%12.3%3/5

AUGUST 2019 UPDATE: Several loans in this month. Sentiment remains high.
JULY 2019 UPDATE: One more loan appearing this month, although only secured on equipment.
JUNE 2019 UPDATE: One more lending opportunity. Ablrate have been slow, but steady.
MAY 2019 UPDATE: A couple more opportunities this month. One gone fairly quickly, confidence here is still high.
APRIL 2019 UPDATE: One opportunity to lend, not particularly great. Have withdrawn a bit.
MARCH 2019 UPDATE: No change. Not many opportunities here.
FEBRUARY 2019 UPDATE: Managed to recycle some funds. A couple of loans have hit some difficulties but in general pleased with how the platform deals with it.
JANUARY 2019 UPDATE: Ablrate are seeking funding on Crowdcube. My investment is unchanged due to lack of opportunities.

What is Ablrate?

Notionally standing for Asset Backed Lending, Ablrate initially started in July, 2014 specialising in aviation-backed loans. Financing is an on-going requirement in this niche and assets can be reliably valued or insured. Many of the first loans were to these types of assets, for example a small Cessna aircraft. However, a decision to start offering more loans saw this niche focus quickly ditched. Today Ablrate offers loans to businesses secured on assets much like other platforms for the purpose of asset acquisition/refinance.

Typically, the interest rates for loans offered on Ablrate is higher than that on other platforms, going as high as 18%. The loans here are somewhat riskier than standard, with debentures over company assets securing the loan, which may not be realisable in full if the underlying business struggles.

The amount of business written so far by Ablrate reflects this; despite being a platform which enjoys a lot of popularity, there is a relatively small pool of borrowers. This could be a result of picky due diligence, or a narrow market for the high cost loan.

Here is a list of Ablrate features:

Advertised ReturnsUp to 15%
Loan TypesBusiness/Property
Loan SecurityAssets/Guarantees
Minimum Investment£1
Cash DragDependent on stategy
Secondary Market?Yes
Provision Fund?No
Auto Invest?No
Available in ISA?Yes
FCA Authorised?Yes
Active on forum?Yes
Sign-up offers?None

What are the alternatives?

Platforms following the broad mix of business lending and assets are Assetz Capital, Funding Circle and Funding Secure.

Ablrate Operating Model

The Ablrate operating model is straightforward, as they only operate one type of account which requires you to select your investment yourself. There no auto-invest, or black-box options, although you may hold your investments inside an ISA.

Depositing money is easy, and unlike other platforms you can fund your account by debit card as well as bank transfer. This is a very useful feature because the money appears in your account straightaway.

It is clear that Ablrate have tried to be fair to all investors, big and small. Before a loan becomes available there is often a designated period where it is in ‘read-only’ mode, so that you have a chance to read the documentation to understand your investment. Once the loan becomes open, bid restrictions apply to the maximum bid to ensure as many people as possible get the chance to participate. (The minimum investment is £1).

Because the typical loan does not rely on sale of a final asset, most of the loans are amortising, meaning that a portion of capital is paid back with the monthly interest. (There are also non-amortising loans on the platform).

Ablrate operate one of the better secondary markets on P2P sites. You can trade out of your investment at any time for no fees, and at a discount (or premium) that you can choose. The secondary market is very transparent, allowing you to see the offers others have made, as well as give you a new projected yield reflecting the purchase price of the loan.

A new type of loan has emerged, called a ‘portfolio’ loan, designed as a more flexible type of loan more akin to a funding facility, where drawdowns can be for a multitude of projects instead of an individual one that is defined.

How are funds protected?

It should be noted that Ablrate do not offer any type of provision fund for their products, reflected in the higher interest rate. Security is provided for by the asset itself, debentures over company assets and/or personal guarantees from directors of the company (if applicable).

Assets are much less reliable than properties as forms of security (although some may dispute that given the performance of some properties held under security). Depending on the asset, they may be quite difficult to value accurately, have a limited scope for sales market, or could be volatile in value.

The personal guarantees are similarly not totally reliable. The guarantee is only as good as the person making it, and it is possible (and legal) for a person to suddenly become asset-poor at the time where the guarantee is enforced. It also possible that enforcement can be challenged legally, which leads to a drawn out case.

Pros of Ablrate

There are many things to recommend about Ablrate:

Good track record: The loan book is performing well at the moment, with very few setbacks. Problematic loans have been handled well in the main, with a default rate of less than 1%.
Higher interest rates: Many Ablrate loans bear a greater interest rate than other platforms, although this comes with an increase in risk.
Amortising loans: Most loans amortise, which gives a quicker repayment and reduces risk as the loan matures.
Instant Returns: Loans pay interest from the time you bid, not from when they drawdown, reducing cash drag.
Good secondary market: 
The market is truly flexible, offering users the ability to discount or add premium, increasing the chance of transactions.
Diversification purpose: The types of loans Ablrate offer are a little different to other platforms and provide investors with a measure of diversification from property or personal loans.

Cons of Ablrate

There are also a few downsides to Ablrate that investors should be wary about:

Increased risk: Higher interest rates imply higher risk. While current loans appear to be well-selected, the nature of the securities involved mean that their values are more volatile, potentially increasing the scope for larger losses.
Borrower Concentration: Many loans on the platform appear to be related to each other, either by company or director. This may have undesirable effects if one loan defaults, such as impairing the ability of the other loans to keep repayments up.
Irregular loan generation: In my experience the rate of new loans appearing on the Ablrate platform is very slow and it would take a long time (or lots of purchasing on the secondary market) to become diversified.

Ablrate Investment Strategy

Currently I am happy with Ablrate and have few problems investing with them. Despite this, I would not commit a large portion of funds to them and regard investments made here as speculative because of the weaker prospects for recovery if loans do go bad. Having said that, they are more transparent than most platforms when it comes to dealing with loans that are late or have gone bad. My own checklist includes:
Assess security – unlike property, it is quite difficult to assess the value of a business asset or debenture, but I would check the borrowing company accounts to ensure they are trustworthy and not a bad year away from being bankrupt.
Avoid second charges – property as a security has popped up now and then, I would be wary of second charges.
Keep investment small – resist the temptation to go large to build up a decent balance here.
Check secondary market – often it is possible to buy loans at par (or close to par) which would be better for your portfolio.
Be wary of related loans – the platform makes it clear when a company has other loans, but not related loans from connected people (ie Directors). Forums can be a good source of information with regards to this.


Ablrate have been impressive since they started operating, giving investors into their loans a very good rate of return. Past performance is no guarantee of the future, and some recent problematic loans have underscored that higher rate loans bear more risks. Despite this the quality of their communications are a notch above their competitors.

Disclaimer: This article represents my own opinions and should not be substituted for investment advice. Please research before you invest with any firm. Typically P2P investments are not covered by the Financial Services Compensation Scheme (FSCS) in the way bank deposits are, and there are no guarantees that you will receive the returns advertised (or even a return at all).



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