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Peer-to-peer investing

RateSetter review

By Michael Trudeau

Article 2 of 5

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RateSetter review

If you're thinking about saving or borrowing through a peer-to-peer lending website, read our in-depth RateSetter review.
RateSetter, like its main competitor Zopa, aims to make peer-to-peer investing as simple as possible.The site automatically allocates your money to borrowers and aims to cover any late repayments automatically and seamlessly. The rates on offer aren't as high as a site such as Funding Circle where you take a more active role in choosing how to lend your money. But if you're looking for an experience that is almost as simple as putting money in a savings account, offering better returns for a little more risk, RateSetter could be for you.

Ratesetter peer-to-peer lender details

Lending terms

  • Minimum lend: £10
  • Lending term: Rolling, one year, or five years
  • Can I withdraw funds early? Yes, but your rate will be reduced to the nearest lending term - eg, funds in a one-year bond taken out after six months would revert to the rate you'd have earned if you'd used the rolling market rate.
  • Rates of return on offer for lenders: Since launch, average rates have been 3.1% for the rolling market, 3.7% for one year and 6.0% for five years (after fees, but before tax. Rates checked 17 February 2017).

Borrowing terms

  • Minimum amount you can borrow: £500
  • Maximum amount you can borrow: £35,000, depending on personal circumstances
  • Borrowing term: Six months to five years, depending on personal circumstances
  • Can loans be paid off early? Yes, and without any penalty fees
Ratesetter peer-to-peer lending satisfaction
Feature Rating
Overall experience
Savings rates
Explanation of the risks
Default rates
Variety of products available
Ease of use of the website
Customer service
Clarity of information on the website
Online community -
Table notes:
Star ratings out of five show levels of satisfaction for each category.

What do RateSetter's customers say about them?

We surveyed 5,000 Which? members in May 2015. These were some of the comments from those who'd invested with RateSetter:

"I'm getting good returns on my investments and am able to control the level of return."

"Good rates, a clear and easy-to-use site, low default rates and a provision fund."

"Simple to invest. Good returns so far.

Alternatives to peer-to-peer websites

If you're looking for a loan, it's worth checking out Which? Best Rate personal loans, too.

In almost all cases you'll want to build up cash savings (in Isas or savings accounts) before considering putting your money into a more risky investment such as peer-to-peer lending.

If you're looking for higher returns you might want to consider other investments.

  • Last updated: March 2017
  • Updated by: Michael Trudeau

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Which? Limited (registered in England and Wales number 00677665) is an Introducer Appointed Representative of Which? Financial Services Limited (registered in England and Wales number 07239342). Which? Financial Services Limited is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited. Registered office: 2 Marylebone Road, London NW1 4DF.