Welcome

astl The association of short term lenders

Welcome from the Chief Executive of the Association of Short Term Lenders

Hello all members, associate members and readers.

I am pleased to report the progress of the Association of Short Term Lenders (astl) and give a short overview of the industry for our latest edition of the newsletter.

Generally, the economy is dull and business conditions are tough.  A recent public opinion poll commissioned by one of our lenders revealed that there is reluctance on the part of credit worthy borrowers to take on more debt; indeed there is a preference to repay it.  Overall, there seems to be a surplus of money-chasing credit worthy borrowers and low risk transactions.  The higher risk applicants are not finding it easy as lenders are risk adverse. 

Against this background, short term lending is perceived as a good investment opportunity offering attractive rates of return and rewards for acceptable, and possibly even low, levels of risk.  The business is perceived to be relatively easy to enter and to operate.  For these reasons, and the perception of several other attractive opportunities, there is a continuing and expanding interest in short term lending.  This interest is coming from financial institutions, funds and wealthy private individuals. 

To date though, there does not seem to be much enthusiasm or appetite from the major banks to support our industry or to provide credit lines of any material extent to our lender members. 

It is no surprise therefore that astl is receiving a constant flow of enquiries from individuals and firms who have just set up as short term lenders or are thinking of doing so.  There is, of course, the ongoing question as to whether there are enough good deals to go around. But as always, entrepreneurs are optimists and there is a conviction that the gaps left by the big banks have created a sufficient demand for the short term lending industry to fill. 

Arising from these conditions, astl has seen an increase of 7 new members in 2011.  Once again I am pleased to mention and welcome;

We have many more enquiries and applications and it is most likely that before the next edition of this newsletter we will be welcoming several more new members. 

We have maintained our associate members and we are in discussions with a few more.  We are particularly keen to attract associate membership from a few other categories of service providers such as a PR and advertising agency, a recruitment agency as well as asset managers and valuers.  Any big bank or financial institution who wishes to have closer links with the short term lending industry would also be more than welcome.

The work of the astl seems ever increasing and there is no let up whatsoever in the volume of consultation papers, directives and proposals for further and different regulation.  The entire credit industry is facing reform and the next year or two will see massive changes.  We are receiving consultation at great frequency, the latest one being a lengthy publication on the subject of Financial Crime.  Lenders are required to be vigilant and check as far as possible the source of borrower’s money, especially big deposits, to explore whether it may have been accumulated from criminal conduct. 

Amongst the various extensive matters of legislation which will change the entire credit industry over the next year or two, there is the Legal Services Act.  From October, law firms will be able to be structured by the alternative business strategy, which means non lawyers will be able to invest in and even own law firms.  This will produce massive changes which will affect the legal profession forever.

I hope all readers are enjoying favourable trading results and as always astl is standing by to protect and promote the short term lending industry.  All queries and comments will be gratefully received.