Registration is not a commitment
Registering as a lender, including the standard identity and anti-money-laundering onboarding, does not commit anyone to fund anything. It gives access to the secure environment where opportunities and their formal offer material can be reviewed.
Deciding opportunity by opportunity
Each opportunity has its own borrower, structure, proposed security, term and risk profile. Returns are specific to each opportunity, vary between them, and are never guaranteed.
What happens after settlement
Where an opportunity is fully funded and documentation is complete, settlement occurs and repayments follow the loan terms. Payments are subject to tax, applicable fees, and default and collection risk.
How a licensed service administers a funded loan
Once a loan settles, the platform's job shifts from presenting the opportunity to administering it. Administration means operating the loan account day to day: recording what is due under the loan terms, collecting repayments from the borrower, applying them correctly, and distributing each lender's share to their account.
Administration also means keeping the records straight, including statements, payment histories and the loan documentation, and acting on the terms of the loan when something changes, such as a variation agreed with the borrower or a payment that does not arrive. Lenders do not manage any of this themselves; it is part of what a licensed peer-to-peer service does.
How money moves between lender, platform and borrower
Lenders do not pay borrowers directly, and borrowers do not repay lenders directly. When a lender chooses to participate in an opportunity, their funds move through the platform's arrangements to the borrower at settlement, once funding is complete and the documentation is signed.
Repayments travel back along the same route. The borrower pays the loan account administered by the platform, and the platform distributes each lender's share of those payments according to the loan terms, less any applicable fees. This structure is what allows many lenders to participate in a single loan without dealing with each other or the borrower.
What a licence means, and what it does not
LendCap is a licensed peer-to-peer lending service. Licensing means the service is authorised to operate under New Zealand law and is subject to the obligations that come with that, including how opportunities are presented and how client money and loans are administered.
A licence is not a promise about outcomes. It does not mean opportunities are approved or endorsed as investments, it does not mean returns are assured, and it does not remove the risk of borrower default or capital loss. Those risks sit with the lender, and they apply to every opportunity.
How this differs from lending to someone directly
Lending directly to a borrower means sourcing the opportunity yourself, assessing the borrower and their security yourself, preparing and enforcing the legal documentation, and then collecting payments and managing problems for the life of the loan. Most people are not set up to do that, and a private arrangement done informally can be difficult to enforce when it matters most.
Through a licensed platform, the assessment, documentation, security registration, settlement and ongoing administration are handled for you, and you choose which presented opportunities to participate in. The trade-off is that you rely on the platform's processes rather than your own, and you still carry the lending risk itself.
If a borrower stops paying
If a borrower misses payments, the platform acts under the loan and security documentation: following up the arrears, working with the borrower where there is a credible path back, and, where necessary, beginning a formal recovery process that draws on the registered security.
Recovery takes time and costs money, and those costs are met from what is recovered before lenders are paid. Depending on what the property realises and what the process costs, the amount returned can be less than the amount lent, so a partial or total loss of capital is possible. This is why the decision made before committing funds, using the full offer information, matters more than anything that happens afterwards.
