Growth Street Review
Return Rate 4
Overall Safety 4
Asset Security 4
Time in Business 3
Lazy Investor Rating 4

Based on my own investing experience with one of the UK’s most popular Peer to Peer lenders. Offering short term lending returns of 5.3%

Summary 3.8 good

Growth Street Review

100% unbiased review. Based on my own investing experience.

 

– Review Updated October 2018

 

Growth Street is a medium size Peer to Peer – Peer to Business (P2P/P2B) lender.  Offering great returns for 30 day lines of credit and invoice financing to businesses throughout the UK. An easy to use website and auto-investing as the only investment option,  Lazy Investors should find Growth Street a good option for storing 30 day accessible cash in a relativity save investment with a very reasonable rate of return.

 

 

My Actual Account Growth

 

 

The Obvious Investor – Easy-Info Table

Overall Rating*: (3.8 / 5)
Who can invest:
Estimated Return:5.3%
My Actual Return (Per Lender):5.3%
My Calculated XIRR:3.99%
Risk Rating*:3/10 - Low   
Early Exit:No, but only 30 day loans, so 30 day exit
Min. Investment:£10
Deposit Funds:By bank transfer. Usually takes 24 - 48 hours for BACS. Can be same day for Faster payments.
Auto Invest:Yes
Manual Invest:No
Lending To:Agreement directly with borrowers.
Loan Types:Short term (30 day) business credit lines & invoice financing
Default Rates:Only 8 defaults to date.
Loans Amortize:No. Loans are 30 days.
Loan Security:Yes.
Loans secured by property, debentures
or personal guarantees
Provision Fund:Yes
Time to Invest:Medium.
Can take a few days depending on loan availability
Time to Mange:None (auto-invest)
Lender Fees:No
Payments Received:When loan is fully repaid usually (30 days)
Amount Lent:£250m +
Number of Investors:1,800+
Loan/Dflt Stats:Yes, Click Here
Regulated:Yes: FCA
Location:HQ - London, UK.   
Launched:July 2014
Website:www.growthstreet.co.uk
Email:[email protected]
Telephone:0808 123 1231 (UK)
IFISA/IRA:No.
Cashback**:Yes! £200 - click here for more information.
How to Sign Up**:Sign Up Here!

 

 

History

Growth Street were launched in 2014 in the UK. In the 4 or so years they have been in business, they have found a niche in the short-term financing business providing a very reasonable 5.3% while only tying your money up for 30 days at a time. This means that, although there is no “quick access” account, you can always be sure to get your capital back within 30 day if you need it in normal market conditions.

Personally I use Growth Street as a store for money that I may need in the future which I know I can get back in 30 days most cases. In my opinion, 5.3% interest is fairly good for an account that you can access in this amount of time.

Growth Street haven’t had to deal with a major recession yet so only time will tell how they fair when that happens, but the fact that money is only tied up for is 30 days means that if I feel things start to get dicey, I will just stop automatically reinvesting my money and have it all back in 30 days.

Current figures suggest that they have lent a total of £252 million (as of October 2018) in the 4 or so years they have been in business which is not bad at all for a short term lender.

 

 

Regulation

Growth Street are regulated by the UK’s Financial Conduct Authority (FCA) with full permissions under FCA number 739318.  They gained FCA permissions in March, 2018. It’s important to note that the FCA is not the same as the FSCS (Financial Services Compensation Scheme), so capital is not protected as it would be in a bank.

Growth Street FCA Screenshot

 

Signup Process

Opening an account is fairly easy. Just the usual ID checks and anti-money laundering verification. If they can verify you though one of the UK’s credit agencies, you will be approved quickly. If not, you may need to send them a copy of your passport or driving license, and a utility bill or bank statement. It should still take no more than 24-48 hours to gain approval. Residents of most countries can sign up with Growth Street, contact Growth Street for requirements for your specific location. You will still need a UK bank account, and possible a UK telephone number. If you don’t have a UK bank account, see my TransferWise Borderless Account review for more information on how it may be possible to get UK banking details if you’re not a UK resident.

 

 

Deposits & Withdrawals

Deposits and Withdrawals are made by bank transfer from a UK bank. Debit card deposit is not available. Deposits from your bank usually show up in your Growth Street account the same or next working day. Withdrawals go to a registered and verified bank account, and typically take 1 – 3- business  days.

Growth Street Deposit Screenshot

 

Time to Become Invested

It can take a few days to get invested into loans with Growth Street. I’ve found it varies based on the amount of capital I am investing, as well as the loan book. Sometimes capital can go into loans almost immediately, however other times it has taken a couple of days. I’ve never known it to take more than 2 working days to become fully invested. You can always see from the main screen dashboard how much is invested and how much is waiting to be invested.

Growth Street Summary Screenshot

 

Who are we lending to?

Growth Street is a true Peer to Peer Platform. Lenders are lending directly to borrowers, who are typically small to medium size British businesses. Loan agreements are directly between the lender and the borrower. Growth Street just acts as a middle man, managing loans, payments and debt collection etc.

 

 

Loan Security

Most of Growth Street’s loans are secured by business assets, invoice receivables and/or personal guarantees. Unfortunately I don’t put much trust in invoice receivables as this is just passing the debt to another company who has the outstanding debt with the borrower. Personal guarantees can be difficult to collect on.  However as loans are typically only 30 days long,  I don’t worry about it too much. Growth street have had very few (single digit) defaults, and they also have a provision fund to cover losses on any unpaid loans.

 

 

Amortization

As Growth Street loans are typically only for 30 days, the loans don’t amortize as they are paid back in full at the end of the loan term.

 

 

Selling Loans and Withdrawing Capital

It is not possible to exit loans early. However because loans are typically only for 30 days, you are really only ever 30 days from being able to withdraw all of your capital. If you set reinvestment to “Do not reinvest”, you should then be able to gain access to all your capital within 30 days or less.

Growth Street Reinvest Screenshot

Once your capital is back in the holding account, you can enter the amount you want to withdraw, and it should then hit your bank within 1 to 3 working days.

Growth Street Withdraw Screenshot

 

Diversification

As you can see by my loan list below, when I first started investing with Growth Street, I stuck to my “Prime Directive” and diversified my loans manually. Growth Street do diversify funds for you, however when I originally put my money on the market, I wanted even more diversification. So I manually broke it up in to £100 chunks to ensure diversification between a lot of loans.

website screen shot

 

Provision Fund

Since I first started investing with Growth Street and diversified my loans per the screenshot above, I realized that a key benefit is Growth Street’s Loan Loss Provision Fund. It is designed to diversify risk automatically for all investors. This is done by collecting contributions from all borrowers, and using those funds to cover missed payments across the whole portfolio; so every investor is exposed to all loans on the platform, rather than just the loans to which they are directly matched. This means that it is not necessary to diversify in to many different loans, as a single loan cannot go against a single investor. Now I know this, I won’t bother to break up funds as I add them moving forward. Growth Street say they have had only 8 defaults in the time they have been in business, and they were all covered by their provision fund which is also a good sign that their strategies to protect lenders are working.

 

 

Retirement Account

No retirement account options available with Growth Street. I couldn’t find anywhere that they are planning one either. If that changes, I will update the review accordingly.

 

 

Using the Website

The Growth Street website is very easy to use. When you first log in, you see a summary of your account.

website screen shot

 

There is only one “portfolio” or “option to lend”, so all you do once you’ve deposited funds is “Place a New Order to Lend”.

website screen shot

Enter how much you want to put on market, then hit the “Place Order” button. Simple as that!

It’s a good idea to set your reinvestment options to automatic so you don’t get cash drag when loans are repaid, because all of the principle and interest are paid back in 30 days. If you don’t have reinvestment set to on, you will need to make sure you are monitoring the website most days to manually place the orders.

 

website screen shot

 

It is easy to see which loans you are invested in with the Growth Street website:

 

website screen shot

 

It is even possible to drill down and see individual loan agreements if you really want to. 

Growth Street Loan Agreement Screenshot

 

However I don’t really see the point as there is not much information in them, and basically they all look the same.

 

Summary

Growth Street is a simple “set it and forget it” peer to peer lender. Their website is easy to use, and their loans are at the lower end of the risk scale. The return for 30 day loans is not bad at all. Once your funds are in the system, you can forget about them until you need to withdraw, in which case you’ll just need to cancel your reinvest options and wait around 30 days. I do check my lender account weekly, but it’s really not needed.

I like Growth Street as a way to have reachable capital in a reasonable amount of time, with a decent rate of return.

 

 

Thumbs Up Points for Growth Street

thumbs up

  • Safety – Growth Street are a medium size company with a good track record. They make short term loans, some of which are secured against personal guarantees, debentures or business assets. The Provision Fund is also a big plus.

  • Auto-Invest –very easy to invest, and hands off investing once set up.

  • Great Rates – 5.3% return for having only a 30 day withdrawal window.

  • Website – very easy to use and understand.

  • Large Investments –although Growth Street’s loan book is not as big as some other lenders. They still manage to gobble up large investments fairly well. It can take a while but it’s never been more than a couple of days for me.

  • Low minimum investment – if your portfolio is still small, it’s still easy to invest with Growth Street. With just a £10 minimum investment to start.

  • Quick, no cost exit –although there is no “instant exit”, we can be fairly sure that we can get all of our money out in 30 days if we need it in normal market conditions.

  • Financial Conduct Authority (FCA) Regulated.

  • IFISA available for UK investors.

 

 

Thumbs Down Points for Growth Street

thumbs down

  • Investment Time – my funds are usually invested in a couple of days. However I have had to wait a little longer for larger amounts of capital. I’ve also noticed a couple of days cash drag on reinvestment at times.

  • Smaller loan book than some of the bigger players, but they are growing fast.

 

 

 

Risk Factor – 3/10 – Low – Medium

                TrustPilot Rating

I consider Growth Street to be at the lower to medium end of the risk scale. Taking in to consideration that many of its loans are secured, it’s hard not to give it a lower risk rating.  However they are lending to businesses which are inherently more risky then lending to individuals. Even though the loans are short term.  I like Growth Street a lot and put a lot of trust in them. As you can see by the TrustPilot review above, so do many other people.

 

 

Who Can Invest with Growth Street

         

Residents of most countries with a U.K.  bank account (see review on TransferWise Borderless Account) can invest with Growth Street. Contact Growth Street for further information.

 

Offers & Signup Links**

 

New Customers receive  £200 cashback when they join Growth Street and invest £5000 or more for 1 year using links here on obviousinvestor.com

Click here for more information on £200 cashback offer >>

Signup for Growth Street Account >>

 


* My opinions on ratings and risk rating factors refer to my personal experiences with the lender. Including factual data such as interest rates, loan types, security, platform history, default numbers etc. Read my Disclaimer before making investment decisions.

**Affiliated! –  I am an investor with this company! (I only review companies I invest with so I can provide an honest evaluation based on my own experience). If you click on an affiliate link, I may receive a small commission, at absolutely no cost to you. It helps me to run this website and continue to offer new reviews and updates.

 

Is this Company in my Top Peer to Peer Lenders List? Click to Find out!

 

 

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Growth Street Peer to Peer Lender Review
Author Rating
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