I’ve long been wary of P2P lending,but tall street banks are offering such paltry returns. So I’ve taken the plungeThe easy saver account at my bank pays a princely 0.25% interest. If I open up its cash Isa and occupy advantage of my tax-free allowance instead, the rate moves up to 0.8%. If I am prepared to move the money and put it in the very highest paying instant savings account in the market, and the amount of interest crawls up to just 1.65% – and that from a bank even I have never heard of. On top of this,the Bank of England, at its latest monthly assembly this week, or decided yet again to hold the base rate at 0.5%. With no sign of ever getting a decent return on my cash,I have finally capitulated.
For years we have written in Guardian Money approximately the tantalising rates on offer from “peer-to-peer” lenders. These are the internet-only operations which offer a sort of lonely hearts service for people who have money, matching them up with people who want to borrow it. By cutting out the banks they offer much higher rates of interest.
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Source: theguardian.com