How do I transfer money to my Go2 investor account?

You can transfer money into your Go2 investor account by Bank Transfer .

Transfers from your own bank can be made either by internet or telephone banking, or in a bank branch into your Go2 investor account. Details of how to do this can be found in the ‘Transfers’ tab. Payments made by ‘Faster Payments’ will usually be available for lending in 1 -2 working days, or 3 -5 working days if made by a BACS transfer.

Funds need to be received within these periods or any bid you make will be removed.  

Where is my money held?

Go2 investor accounts are held on trust in a segregated client account at Barclays Bank plc. This means that your un-lent funds are treated as separate from Go2’s own accounts, and from the Go2 accounts of other investors and borrowers.

Are investors anonymous?

The only details that will be shared with other investors are your user name.

When you are successful in lending money to a borrower, your real name will be included in the key contract terms which a borrower can see. This is required for legal purposes. No other investors will be able to see your real name or details, and loan contracts are not disclosed other than to a borrower unless required by law or regulation.

What fees are investors charged by Go2?

Go2 will charge investors a 1% annual Administration Fee (VAT inclusive) based on the principal amount outstanding of each of your loan parts. 

This fee will be deducted on a proportionate basis each time a repayment is received from a borrower. If a borrower misses a payment we do not charge the administration fee until l the borrower corrects that missed payment. 

If you wish to sell your loan parts to other investors, you can do this through the resale section of the site, Go2 will charge you a 0.25% "Sale Listing Fee" based on the principal amount remaining on the loan parts you sell. We will only charge a ‘Sale Listing Fee’ if your loan parts are sold and the fees will be deducted from the proceeds of any loan parts sold.

What are the estimated bad debt rates?

A bad debt is defined as “A debt that is not collectible and therefore worthless to the creditor. This occurs after all attempts are made to collect on the debt.” Bad debt rates are defined as the “annual level of expected losses”. 

The rate therefore takes into account for any funds not repaid by borrowers and not recovered from the debt collection process. Estimated bad debt rates are annualised so they can be used by investors to help set their gross interest rates.  Expected annual returns can be calculated by simply deducting the bad debt rate from their gross interest rate they are offering to businesses.

Using data from Experian, including the historical amounts of bad debts experienced in similar businesses, best estimates of the likely levels of bad debt that will be experienced in each risk band can be seen below.

Risk band Estimated annualised bad debt rate
A 1.5%
B 2.5%
C 3.5%
D 5.5%
E 8.5%
F 15%

No difference to estimated bad debt rates is expected for each risk band for debts of 1 ,3 or 5 years Go2 has not set minimum bid rates so investors should place bids to take into account the risk of loss from bad debt. Remember, you are lending to businesses so your capital is at risk.

Estimated bad debt rates are no guarantee of the actual bad debt you will experience for each risk band or individual loan. Investors should spread their lending across a portfolio of businesses to reduce the impact of any single default.

How are my monthly repayments calculated?

All repayment schedules are calculated at the time when the borrower accepts a loan. Each month you will receive a repayment of principal and an interest payment, based on the outstanding principal, from the borrower. These can be seen on your statements.

Principal is the money that is still lent out to the borrower on the loan part. Each month the borrower will repay a portion of the principal outstanding on the loan part plus interest due on the principal amount. The sum of these two payments will be equal each month, hence each month you get repaid a set amount from each borrower. The total amount you receive each month may be marginally different due to the rounding of repayments. This occurs because we round down interest and principal repayments to the nearest penny until a full penny has been accumulated at which point it is paid out to the investor.

A 1% annual administration fee is payable for for loan parts. This is based on the amount outstanding on each loan part, and is collected for each loan part if, and only if, a borrower makes a payment to you. 

What happens if a borrower defaults on the loan?

Go2 will try to recover as much as possible of the outstanding principal if a borrower defaults.

If a business ceases to trade, and the loan has a personal guarantee Go2 and our debt-collection team will pursue the guarantors for the unpaid sums due. If the loan has an all asset security agreement attached we will attempt to realise these assets to repay the sums due to investors. If the loan has specific asset security, we will take possession of the asset and attempt to realise this asset to repay the sums due to investors.

If the loan does not have any security, Go2 will attempt to recover the maximum amount possible as a creditor of the business through the courts. 

Recovery is not always possible, in which case, the value of your investment could go down. 

What is the credit score?

The credit score provides an indication of the creditworthiness of a business. 

The credit score shown for limited companies is taken directly from Experian, a credit ratings agency we currently use and are not calculated by Go2. You can read more about Experian’s Delphi scores on Experian’s website.

Credit bands are based on Experian's delphi score as follows:

Delphi Score Band Level of risk
91-100 A Very low risk
81-90 B Low risk
51-80 C Below average risk
26-50 D Above average risk
16-25 E High risk
1-15 F Maximum risk

Please be aware, even if a business has a credit score of 100 (out of 100), this does not guarantee that they will be able to fully repay their loan. 

How are interest rates set?

You decide the gross interest rate at which you want to lend at. There is no minimum interest rate which you can bid at and the maximum interest rate across all risk bands is 15%.

All interest rates are simple (not compound). This means the borrower only pays interest on the amount borrowed. 

If the rates you offer are too high, your bids may be undercut by other investors. This may mean that your money will remain un-lent for a longer period of time which could adversely affect the returns you receive from the funds deposited with Go2.

Borrowers automatically accept the lowest interest rates to fully fund their loan request

If you purchase loan parts on the resale market you can only choose to purchase loan parts at the interest rates offered. 

Please be aware, you are lending to businesses so your capital is at risk.

What are the tax consequences of lending as an individual?

Investment Returns from lending through the Go2 platform are currently paid without any tax being deducted. If you are lending as an individual you should declare any interest and gains to the HM Revenue & Customs on a self-assessment tax return or inform your local tax office.

At the end of the tax year Go2 will make provide all investors an Annual Tax Statement, splitting out the relevant amounts for your tax return,.

Please note, we are unable to provide any further information about tax other than what is provided in this section. The wording below is for indicative purposes only, and does not constitute tax advice. If you are in any doubt about your tax position you should speak to your accountant.

Taxation of interest earnings

  • Income tax from interest earnings is not currently deducted by GO2 and you will need to declare these to HMRC.
  • Interest payable to investors on money loaned is charged to income tax in the tax year of receipt. 
  • If you already complete a tax return you will need to ensure the appropriate interest is reported on the return.
  • If you have not previously completed tax returns you will be required to do so if you have a tax liability and should contact your local Tax Office.

Taxation relief for irrecoverable loans

  • Unlike peer to peer lending where individuals lend to other individuals, relief from Capital Gains Tax may be available on loans which become irrecoverable.
  • In order to qualify for relief the loan must be made to a borrower who:
    •    Is resident in the UK, and
    •    Uses the money wholly for the purposes of a trade.