A message from our CEO, Daniel Foggo
As a valued RateSetter customer, I wanted to let you know how we are responding to the impacts of COVID-19. The situation is still evolving, but I’m confident we are well positioned to prosper in these more unpredictable times.
RateSetter is here to help and support our customers and partners during this period. Please don’t hesitate to contact us if you need any further information or support.
We have a business continuity plan for situations such as these, and we’re following this plan. Among other things, in recent days we have:
- Adopted work-from-home arrangements for our Sydney and Adelaide-based staff to help protect our customers, partners and employees;
- Brought many business processing functions onshore to ensure our quality customer service is uninterrupted; and
- Conducted thorough reviews of information security arrangements to ensure our customers’ and partners’ data remains secure.
Even with these new arrangements, I’m pleased to report that borrowers, investors and partners will continue to work with us without any delays in our services: we do not anticipate any significant impact on the time it takes a borrower to apply or be approved for a loan, or on the service level we provide to our investors and partners.
Importantly, the quality of our credit and risk processes will remain unchanged. Our credit team continues to function at full capacity and, as always, we are vigilantly monitoring both the performance of our outstanding loan book and the pricing and provisioning we apply to new lending.
Investing with RateSetter
Periods of volatility are part and parcel of investing in the long term. In recent weeks we have seen significant volatility in shares and foreign exchange, and rapidly declining interest rates.
We believe that RateSetter’s investment products are well equipped for these periods. Your funds are invested in loans to creditworthy borrowers (rather than exposed to volatile equities), who make payments of principal and interest typically monthly via direct debit. Further, rates are set in our lending markets, rather than with reference to central bank rates.
We believe the evidence shows that consumer credit is an exceptionally stable asset class, helped by creditworthy borrowers typically behaving rationally to pay down their debts quicker in times of uncertainty. Our Chief Risk Officer Simon Cordell addressed this and other aspects of our loan book in greater detail last week.
Further, the Provision Fund has an unblemished record for protecting investors against borrower late payments or defaults. We believe the Provision Fund is well capitalised, and we regularly perform stress tests to assess its adequacy in times of uncertainty. Although the Provision Fund is neither a guarantee nor an insurance product, we are confident in how it is positioned. The Provision Fund buffer coverage ratio is 159%, meaning 1.59 times our current estimate of expected losses on outstanding loans. Finally, to ensure the Provision Fund remains well capitalised, we can adjust contributions to the Provision Fund on an ongoing basis for all new loans.
Borrowing with RateSetter
We continue to welcome new applications for RateSetter loans from creditworthy borrowers:
- Personal loans: learn more about RateSetter personal loans and get a personalised RateEstimate
- Car loans: learn more about RateSetter car loans (including our car loan refinance to help you save money) and get a personalised quote
If you are an existing RateSetter borrower and you are having trouble making your repayments or require assistance due to financial hardship, please don’t hesitate to email us at firstname.lastname@example.org or call us on 1300 768 710. We will be able to provide you with a financial hardship application and discuss your options.
Our mission and our resolve in these challenging times remains unchanged: we want Australians to achieve more with their money, for less.
In conclusion, whilst these are unprecedented times and there will surely be more developments in the coming days, weeks and months, we hope you are comforted by the fact we have been contingency and risk planning since we commenced operations in 2014. Our commitment to openness has never been more important, and we’ll endeavour to keep you updated with RateSetter developments.