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Peer to peer lending » Archover

Archover

Archover

ArchOver is a peer-to-peer lending platform that offers SMEs a more flexible way to raise working capital. They have helped Lenders invest  £110 million to British businesses. They also offer a Research & Development Advance lending service; all loans are secured against the borrowing business' assets.

A Lender can invest on a loan-by-loan basis in multiples of £1000 with terms from 3 months to 36 months or increments of £250 via their automated Investment Plan over a 26 months period. All interest is paid monthly from the loan drawdown date.

An Innovative Finance ISA is available with all the opportunities with tax-free on savings up to £20,000

ArchOver has a wind-down plan in place if for any reason they should cease trading with Hampden Group.  They are not only contractually bound to provide “wind-down” services but also ensures ArchOver remains operational and FCA regulated through the term of any “wind-down” and “run-off” of the loan book.


Archover Products and Investment

    • Initial lending with a view to becoming S&I- or S&A-based
    • Bespoke security, usually second Charge against business
    • Some features of Secured & Insured or Secured & Assigned
    • Credit analysis, monthly monitoring

    Bespoke loans are made on the same basis as S&I or S&A loans, with the sole exception being the rank of the all-assets charge. Bespoke loans are usually initially secured with a second charge which will transition to a first charge within a short period, usually less than three months. This flexibility allows us to raise larger amounts of money for Borrowers, without initially disturbing existing facilities.

    Interest is set to reflect the initial period, during which the security is weaker. The rate remains unchanged throughout the loan term, giving Lenders the opportunity to enjoy a higher rate of interest than is usual for an S&I or S&A or S loan.

    All other features of S&I or S&A or S apply, as appropriate.

    All security details are listed alongside each loan on the platform. It is recommended that Lenders read and understand the information within the Project Description before investing.

    term: 3 - 36 months min. investment: £1,000 return: up to 9.00%*
    * provided on 16/01/2020

    Unsecured short-term lending against either an R&D tax claim or qualifying grant
    For companies with history of successful R&D claims/Grant claims
    R&D funds paid direct to ArchOver controlled bank account
    R&D claim prepared by third party professionals
    Successful Grant history or awarded Grant has achieved first payment/milestone deadlines

    R&D Tax Claim

    The Research & Development Advance is short-term lending against an identified Research & Development (R&D) claim payable to a company by HM Revenue and Customs (HMRC) or against an Innovative Grant Advance (IGA).

    HMRC has made allowance for companies they deem to be undertaking qualifying Research & Development activities. Companies can claim cash repayments of up to 33% of the qualifying R&D expenditure. The claims are made with a company’s tax return (CT600) each year, with claims up to two years in arrears also allowed.

    It can take up to three months between a company making a claim and receiving payment from HMRC. ArchOver helps companies ‘bridge this gap’ by facilitating a loan under this RDA lending service. Importantly, the loan can be drawn down up to 12 months before the claim is expected to be received, allowing companies to receive advance funding for their ongoing R&D.

    The RDA is available only to companies that can demonstrate a history of successfully claiming R&D tax credits from HMRC with at least two years of successful claims having been made. Additionally, the company must have retained professional advisers to help in the preparation of the R&D tax credit claim. When making the claim, the company seeking the advance must advise HMRC to pay all the funds claimed to an ArchOver controlled bank account. The directors of the company seeking the advance must warrant that the PAYE, CIS, VAT and CT payments are up to date (i.e. that the company has no overdue debts to HMRC) and will be maintained up-to-date throughout the period of the loan.

    Qualifying Grant

    For an IGA (Innovative Grant Advance) we review previous successful applications for grants and delivery of projects in accordance with the application and receipt of payments substantially as scheduled. However, if no previous IGAs have been delivered on by the Borrower, we need to see the Grant being advanced against has been signed and agreed, they have received the first payment (normally this is on signing) and they have submitted and received at least one payment request for the first period (the length of periods will vary) of the grant.

    Furthermore, the directors confirm that, in their reasonable opinion and having made reasonable enquiries, the borrowing business has sufficient funds to trade through the period of the loan and beyond.

    All details are listed alongside each loan on the platform. It is recommended that Lenders read and understand the information within the Project Description before investing.

    term: 3 - 36 months min. investment: £1,000 return: up to 9.50%*
    * provided on 16/01/2020
    • All-asset charge against business
    • Secured against Accounts Receivable (ARs) or contracted recurring revenue
    • ARs uninsured/recurring revenue unassignable
    • Credit analysis, monthly monitoring, controlled bank accounts

    This type of borrowing is similar to our S&I or S&A services except that, for good reason, the borrowing company cannot get credit insurance (eg, providing services to HM Government) or we cannot obtain an assignment of contracts.

    We register a first all-assets charge at Companies House over the borrowing company. This means that, if the borrowing company defaults and we appoint an administrator, we have the first call on the company’s assets. We perfect this with an ArchOver controlled bank account into which payments from Borrower customers flow. Except in the event of insolvency proceedings, the controlled account is cleared each day to the Borrower.

    Should the Borrower be a firm of solicitors, we cannot operate a controlled bank account. Firms of solicitors operate with authorisation from, and are subject to, the rules of the Solicitors Regulatory Authority (SRA). The SRA does not allow lenders to operate a controlled bank account for client revenue. In this scenario, ArchOver’s charge could be open to challenge and reduces security on the loan.

    When assessing the maximum loan advance, ArchOver will consider the value of the Accounts Receivable (ARs), deducting trade debtors out of term. The maximum loan-to-value of security provided is 90% against the trade debtors plus 50% against the work-in-progress. Accordingly, the discounted security must always be equal to or greater than the loan value. Alternatively, we look at the revenue generated in a year from contracted recurring sources. When calculating this, we make an allowance for the customers who will be lost. This loss of customer base is known as 'churn' and must be in single digit percentages each year. The loan is usually no more than a 3-month advance against the annual contracted recurring revenue.

    All security details are listed alongside each loan on the platform. It is recommended that Lenders read and understand the information within the Project Description before investing.

    term: 3 - 36 months min. investment: £1,000 return: up to 8.00%*
    * provided on 16/01/2020
    • All-assets charge against business
    • Secured finance against contracted recurring revenues
    • Guaranteed revenue contracts assigned to ArchOver
    • Credit analysis, monthly monitoring, controlled bank accounts

    An increasing number of companies provide the use of their assets, be they physical or intangible assets, under rental or licencing agreements. These agreements provide the supplying company with long-term contracted revenue streams, making the businesses stable, predictable and potentially ideal Borrowers.

    This was the second service we introduced.

    We register a first all-assets charge at Companies House over the borrowing company. This means that, if the borrowing company defaults and we appoint an administrator, we have the first call on the company’s assets. We perfect this with an ArchOver controlled bank account into which payments from Borrower customers flow. Except in the event of insolvency proceedings, the controlled account is cleared each day to the Borrower.

    When determining the maximum value of the loan, we consider the revenue generated in a year from contracted recurring sources, such as a rental income. When calculating this, we make an allowance for the customers who will be lost. This loss of customer base is known as 'churn' and must be in single digit percentages each year. The loan is usually no more than a 3-month advance against the annual contracted recurring revenue.

    All security details are listed alongside each loan on the platform. It is recommended that Lenders read and understand the information within the Project Description before investing.

    term: 3 - 36 months min. investment: £1,000 return: up to 7.75%*
    * provided on 16/01/2020
    • All-assets charge against business
    • Secured finance against Accounts Receivable
    • Accounts Receivable (ARs) insured against late or non-payment
    • Credit analysis, monthly monitoring, controlled bank accounts

    Our original and core service.

    We register a first all-assets charge at Companies House over the borrowing company. This means that, if the borrowing company defaults and we appoint an administrator, we have the first call on the company’s assets. We perfect this with an ArchOver controlled bank account into which payments from Borrower customers flow. Except in the event of insolvency proceedings, the controlled account is cleared each day to the Borrower.

    For Secured & Insured loans, the assets that we are primarily interested in are the Accounts Receivable (ARs). The ARs of a business comprise the total owed to the borrowing business by its customers (trade debtors) plus contracted work-in-progress (WIP) (valued at cost). The security provided by these assets is further enhanced by a credit insurance policy, usually provided by Coface, which we insist the Borrower takes out with ArchOver as the joint-insured and loss payee. Usually, the credit insurance cover provided is 90% of the value of the ARs and pays out in the case of protracted default or where the Borrower’s customer’s business fails.

    When determining the maximum value of the loan, ArchOver considers the value of the ARs, deducting trade debtors out of term and for amounts uninsured. The maximum loan-to-value of security provided is 90% against the trade debtors plus 50% against the WIP. Accordingly, the discounted security must always be equal to or greater than the loan value.

    All security details are listed alongside each loan on the platform. It is recommended that Lenders read and understand the information within the Project Description before investing.

    Please note: Credit insurance (the ‘I’ of ‘S&I’) does not insure the loan or interest payments and does not guarantee the repayment of Lenders' capital in the case of Borrower default.

    term: 3 - 36 months min. investment: £1,000 return: up to 7.75%*
    * provided on 16/01/2020

Investor Overview

  • Minimum investment starts at £1,000.
  • Terms range from 3 months to 3 years.
  • Back individual business loans secured against Accounts Receivable or contracted recurring revenues.
  • There are no fees for lenders.
  • IFISA available.
  • SIPP available.
  • % of default rate not available, 1 default in 2017 and 3 defaults in 2018.
  • * correct as of 16/01/2020
Invest

£79M
loan book volume

* correct as of 12/11/2018

07235487
company number

26/04/2010
incorporated 10 years ago




  • Internet Business Awards Category Award Winner 2015
  • Hertfordshire Business Awards Finalist 2014

As seen in:

  • The Guardian
  • Financial Times
  • Yahoo! Finance
  • The Times
  • The Daily Telegraph