I first heard of P2P lending a few years ago, very soon after I started on this journey to the land of FIRE. “This is for me!” I thought almost immediately, I really liked the idea of both savers and borrowers getting a better deal from these companies than they could do from high street banks.

Then I promptly did nothing about it for about 3 years.

The reasons I had were fair enough:

  • I wanted to get some money into tax wrappers and in stocks and shares first of all
  • I was only just starting out on building a portfolio of investments and it’s best not to keep more than a few percent of your diversified portfolio with any one P2P provider.
  • Therefore I couldn’t see the point in only investing only a few hundred into one, it just didn’t seem worth the hassle.
  • Also with the Santander 123 account paying out 3% interest on the first £20K and with no real risk it seemed pointless trying to take on more risk just for a couple of extra percent interest


Now I’ve been building some equity in tax wrappers over the years, pound by pound, so have been knocking on the door of being ready to put some of our funds into P2P, but have found it hard to pull the trigger, until very recently when this news from Santander came through the post:



Bit of a game changer, right?! And I’m sure many of you shrewgal 1 folk out there in the FIRE community will be affected by this.

So it seemed like a great time to get involved with the Ratesetter £50 Bonus Offer 2 which has been flying about for a while now. Here is some information you might be wanting to know about before you trust these guys with your hard earned moolah.


£50 free? What’s the catch?

There are two catches as such but they minor ones from my point of view:

  • You have to invest a minimum of £1000 – As I mentioned earlier I don’t really see the point in going with much less than this in any given investment, or you’ll be spreading yourself too thin across too many different types of investment or company. I mean, remembering all of the logins would be a nightmare for a start 🙂
  • The £1000 must be full invested for a whole year – Again, no big deal, right? Why would you be investing at 4-5% for less than a year? I’m not sure. That’s what holding cash in the bank is for.

So with those two minor hurdles out of the way I stumped up the bag of sand 3 required and put opened up an account.


you won’t believe this…

…but what surprised me the most about Ratesetter was that it has a nice and simple UI 4 for a financial services website… seriously!

Here are a few screenshots of the sign up process and user interface to show you roughly how easy/hard it is (I found it pretty easy obviously) to sign up and see what’s what…



The five step sign up takes 5 minutes by Ratesetter’s reckoning, my experience of that was about right!



I chose to lend in the 5 year market as it had the highest rate, but you will get the £50 bonus after funds are in there for just one year. You can also sell out your investment early if you really need the cash back but obviously will lose some money if you do that.

I’m not planning on needing this grand any time soon so hopefully it can sit in there and be worth £1294 nominally after 5 years.

I’m guessing you’re wondering what the other rates and timescales available are. Here are the last rates matched which are displayed on the left hand side every time you log in:



Once you’ve selected your product you can also select the rate you want to achieve. I thought I’d be bold at go in at 5.3% even though the lender queue was at 4.9% for the 5 year product. I thought well if it takes 2 or 3 weeks to get matched it will be worth it over 5 years to get that extra few a percentage points. You then get to see the dashboard which gives you an overview of your matched or unmatched money and various other options down the left hand menu:



I logged off and then was very pleasantly surprised to receive an email not 5 minutes later to tell me my money had already been matched to a borrower!



So far, so easy! (Although thinking maybe I should have tried for a higher rate!?)

I will now look forward to receiving payments and interest paid back every month and also the £50 bonus in a years time. They even tell you exactly how many days left until you will get your bonus, nice touch:



I will probably experiment with putting in some higher percentage offers and seeing if they get matched, but even if they don’t, 5.3% is not to be sniffed at in this ZIRP 5 environment.


SIPPs and ISAs

One extra interesting thing to note is that you can already invest with Ratesetter into a SIPP to take advantage of all the lovely deferred tax benefits they offer. And apparently an ISA option is coming soon. Back of the net!


would you risk it for a chocolate biscuit?

This post would not be complete without talking about the risks of P2P lending. In particular hammering home the point that Ratesetter is not a bank and therefore not covered by the FSCS protection.

This means that 1) if the company goes down the pan or 2) there is a massive default rate by the borrowers you are matched to, you could lose all your capital.

However it is worth noting that scenario 1) is extremely remote and scenario 2) is covered pretty well by Ratesetter’s Provision Fund, which they’ve been building up in case of unexpected number of loan defaults. They are so transparent 6 you can even view this fund in real time, here is a screen shot at the time of writing:



Some more real time info on the state of the books:



And some historical performance to put things into perspective for you:




In case you hadn’t guessed by now I was really impressed by Ratesetter, mainly just by the website and how easy everything was, and how many real time stats and historical data they had directly to hand. You sometimes have to dig deep for this sort of info but it was just all there right off the bat. Other financial websites, please take note!

The headline high interest returns and £50 bonus are what hooks you in but I think you’ll end up staying for the other reasons mentioned above.


Have you had any dealings with Ratesetter or other P2P platforms? Let me know of your experiences in the comments below? Cheers!


Just in case you missed the hundreds of links to the bonus offer in the main text here is another one 🙂

Click here to take advantage of Ratesetters £50 sign up bonus offer




  1. Yes that’s right, I just made up a new word by merging shrewd with frugal. I know what you’re thinking: #amazeballs ? Maybe not 🙂
  2. Full disclosure: all of the links to Ratesetter on this page are referral links and I will receive a sum of money if you sign up through it and take part in the £50 bonus offer. This does not affect your bonus in any way: it is paid to me directly from Ratesetter and not out of your bonus. If you would rather sign up without me getting any money that’s cool, just google ratesetter and click on the first link that comes up! If you do sign up through any links on the page I bestow good luck upon you and your family.
  3. Grand = £1000 for anyone not au fait with cockney rhyming slang
  4. User Interface
  5. Zero Interest Rate Policy
  6. Why can’t all companies be like this!?