Is Plenti a Bank?

In July 2021, new personal fixed-rate loans in Australia amounted to AU $1.98 billion. This signifies a 14.2% increase from the loan commitments signed the previous month. Most of these loans were for vehicle purchases, while others were for personal uses.

The company known as Plenti is one of the most popular sources of such loans.

So, does that mean Plenti is a bank? What exactly is this company all about anyway, and what types of financial products does it offer?

We’ll answer all those questions and more in this comprehensive guide, so be sure to read on.

What Is Plenti?

Plenti is a peer-to-peer (P2P) lender that caters to Australian consumers. However, just because it’s a lender doesn’t mean it’s already a bank. In fact, it falls under the specific class of non-bank private lending institutions.

Before the company became Plenti, though, its original name was RateSetter Australia. However, it rebranded to Plenti in 2020, after Metro Bank acquired RateSetter UK. Since the Australian-based brand wasn’t part of the Metro Bank deal, it decided to change its name.

As a P2P lender, Plenti operates online for the most part, which is why it’s also known as a fintech company. However, the company maintains a physical head office in Sydney, NSW.

Fintech stands for financial technology. Such companies enable, process, and approve loan applications entirely online. They even disburse approved loan funds via digital means.

What Makes P2P Lenders Different From Banks?

In Australia, P2P lending also goes by the name marketplace lending. The marketplace in this context is an online platform connecting borrowers with investors. The individual investors, in turn, are the ones who provide the money to finance the loans.

As a P2P lending platform, Plenti matches borrowers with non-bank lenders. So, if you’re a borrower, a non-bank investor will be the one to fund your loan. If you’re an investor, then Plenti will use your money to finance another person’s loan.

By contrast, banks usually use their depositors’ money as a means to fund loans. For example, let’s say you’re a depositor who keeps $10,000 in your bank savings account. Your bank may then pay you a competitive interest rate of 1.5% if you give them your money for “safekeeping.”

Your bank will be able to pay you that interest by letting others borrow your money. Don’t worry, though, as your money won’t actually disappear from your account. You can always retrieve it anytime you need to, but in doing so, you may no longer earn interest.

The money that the bank will use to pay you will come from the interest payments of borrowers. The rest, they get to keep as profits.

Is P2P Lending Safe?

For borrowers, yes; in fact, it can even help you unlock lower-cost loans. So long as you’re creditworthy and have a good repayment history, then you may be able to snag a low-rate Plenti loan.

Besides, all law-abiding P2P lenders must carry an Australian financial services (AFS) license. They must also have an Australian credit license to offer consumer loans. Plenti carries both.

P2P lending does have risks, but for the most part, the lenders and investors are the ones who take risks. That’s because, unlike with banks, P2P investments don’t have government backing. As such, investors (the ones who do the lending) are at risk of losing money if a borrower fails to pay them back.

What Financial Products Does Plenti Offer?

As the folks at Plenti themselves put it, they offer loans for “almost anything.” However, they classify their financial products into six different categories. Let’s take a closer look at each one of them.

  1. Personal Loans

With Plenti, you can apply for a personal loan with a principal amount of $5,000 to $50,000. How much you’ll get would still depend on your repayment ability, though.

As for repayment terms, you can choose from anywhere between one and seven years. However, keep in mind that the longer the term, the more you’ll pay toward interest fees. At the same time, a longer loan term means you’ll make lower monthly payments.

With personal loans, you don’t need to tell the lender any specific reason you need money. Once you get it, you can then use the funds to finance your wedding, a vacation, or buy new appliances. Whatever you fancy, you can use your Plenti funds to turn it into a reality.

Just remember to borrow and spend within your means to avoid piling on debt.

  1. Auto Loans

In the first half of the 2020 fiscal year, Plenti originated loans amounting to $167 million. Close to half of these loans, or $81.1 million, were for auto loans alone.

In terms of principal, Plenti can grant you a car loan ranging from $10,001 to $100,000. Both secured (collateral required) and unsecured loans are also available. Then, if granted, you can choose to pay back the loan within three up to seven years.

You don’t necessarily have to buy a passenger car to take out a vehicle loan with Plenti. You can instead use the funds to finance the purchase of a motorcycle or even a boat.

  1. Home Renovation Loans

If you’re one of the 66% of Aussie homeowners (with or without a mortgage), chances are, you want to improve your house. Perhaps you want to extend it, install energy-efficient windows, or swap out its old roof. Whatever enhancements you wish to do, a Plenti home renovation loan can fund your project.

The terms are similar to those of a personal loan; you can borrow $5,000 to $50,000 based on your repayment ability. You can also repay a home renovation loan over the course of one up to seven years.

  1. Green Loans

Green loans from Plenti are specifically for financing the purchase of energy-efficient products. These include solar technologies, such as solar panels, heaters, and batteries. Energy-efficient air conditioners, LED lights, and hybrid low-emission cars are other examples.

Plenti grants green loans with principal amounts of $2,001 to $45,000. They’re repayable over terms of between three and seven years.

  1. Debt Consolidation Loans

Did you know that Australia has the second-highest household debt among OECD nations? Many Aussies, after all, carry not only mortgage debt but also credit card and student loan debts. So, it’s no wonder that about a third of surveyed Aussies believe they’ll be in debt for life.

If you’re one of those folks, you may want to consider a lower-cost debt consolidation loan from Plenti. With this, you take on a new loan, the funds of which you’ll use to pay off some of your other existing loans. So long as the new loan has a much lower interest rate, then it could be an effective way for you to get out of debt.

  1. Legal Loans

Legal loans are products designed to finance the costs of a legal matter. These include the fees charged by lawyers, legal accountants, or mediators. So long as the expense has to do with a legal affair, you can use the funds from a legal loan to cover it.

Plenti offers legal loan amounts ranging from $25,000 to $400,000. That gap exists because the loanable amount depends on the value of a pledged security.

With legal loans, the collateral is usually the expected amount of property settlement. Plenti usually loans up to 30% of the expected settlement.

What Do You Need to Apply for a Plenti Loan?

First, you need to be at least 21 years old and a permanent resident or citizen of Australia. It’s also imperative to have a good credit history and to have a regular source of income.

The entire loan application process is online, so you need to have access to the internet. You also need to provide a copy of your bank statements, as Plenti will use this to verify your income.

Prepare to provide personal info, such as your complete name, address, and date of birth. You have to provide a valid email address and a working mobile or home phone number too. Plenti would also ask you if you have dependents, and if so, how many.

Once you’ve finished the application and given all documents, it can take up to 2 days for Plenti to process it. They will then get in touch with you to notify you about your application’s outcome.

If you get approved, you’ll receive a copy of the loan contract via email. Make sure you review it thoroughly before agreeing. Once you’ve accepted the offer, you can expect the loan funds to reflect in your bank account within 24 to 48 hours.

Consider Plenti as One of Your Alternative Lenders

Plenti may not be a bank, but it still funds plenty of loans in Australia. So, if you need one ASAP, this private P2P lender may be a good alternative.

Just be sure to pay back your Plenti loan on time, as you don’t want your credit score to drop, after all. Besides, it’s a sign of consideration to the investor who gave you quick access to funds when you needed it the most.

Ready for more financial guides like this? Then feel free to check out our latest informative blog posts!

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