JustUs is an electronic system accessible from the website with the URL http://www.justus.co (“Website”) which system facilitates lending between lenders and borrowers (“Platform”). The Platform is owned and operated by eMoneyHub Limited. eMoneyHub Ltd is Authorised and regulated by The Financial Conduct Authority. eMoneyHub Limited is registered in England and Wales. Registered Address: Block 1 G82 Alderley Park, Congleton Road, Nether Alderley, Macclesfield, Cheshire SK10 4TG. Company Number 08158588.
eMoneyHub Ltd is registered with the Information Commissioner number ZA589341. The Platform has been created to allow persons who wish to lend to be matched with persons who wish to borrow. The platform determines the financial standing of the borrowers and provides a risk grade for each eligible borrower. We do not provide loans ourselves, but we do provide Borrowers and Lenders with a facility, through the Platform for the placing of loans with each other (“Services”).
A guidance consultation from the FCA (GC16/05) stressed the importance of regulated firms considering the contents of a wind-down plan as best practice. This was further enhanced in June 2019 following the publication of Policy Statement PS19/14. Guidance from a Thematic Review TR22/1 was published in April 2022 (post pandemic). This plan has been reviewed considering subsequent FCA communications and supervisory expectations issued since 2022.
Wind-down planning is described as a process in which the firm’s governing body:
As a peer-to-peer platform we are unusually advanced in already considering much of a wind-down plan as the regulatory requirement to conduct the activities of an “Operating an electronic system in relation to lending" mandate that we have:
Using the FCA guidance and Quick Reference Guide (See section 8) this plan sets out the governance arrangements, operational procedures, estimated costs and resource requirements for an orderly wind-down of the business to a point where it ceases its regulated activities and achieves cancellation of its permission with minimal adverse impact on its clients or counterparties.
It is reviewed once a year in line with the compliance monitoring programme calendar of events considering any further guidance and learnings from our own BCP testing
A copy of this plan can be downloaded here.
The Board of eMoneyHub Ltd has ultimate responsibility for the firm and its stakeholders. As such it will determine when the wind-down plan will be invoked.
In the event of a trigger event, the Board may consider multiple options available to support recovery to a viable position, such as finding potential investors to acquire or invest in the stressed business. Where all alternatives have been exhausted, despite positive management actions, the wind-down plan is invoked.
Clearly for any business the wind-down plan is action of last resort, but it is recognised that if the Board considers that the business is not a going concern then the implementation of the wind-down plan must be considered.
As parent company of the group, should the wind-down plan be invoked by the Board then all subsidiary companies will form part of the plan. Separate workgroups for each subsidiary may be set up to report back to the Board and the wind-down plan leader.
On conclusion of the wind-down plan the Board, via the wind-down plan leader will formally notify the permission granting authority of its cessation of activity and request withdrawal of permissions.
Timeline planning
On invocation of the plan a realistic project management timeline will be presented to
the Board by the wind-down leader. This timeline will include, communications, finance handover, staffing plan,
“living will” provider hand over, and regulator liaison.
Communication Plan
Notification of the wind-down and next steps to be distributed to all stakeholders:
Finance Handover
This is detailed in the CASS resolution pack and would happen within 48 hours of
invocation.
Staffing plan
The core staff identified to execute the wind-down plan are:
Living Will provider
The living will provider, is on a retained contract to supply services to run off
the loan book on a ‘trigger event’. Invocation of the wind-down plan would be deemed a trigger event, and full
details can be found in the Resolution agreement. Should this variation of permission not be forthcoming then the
outsourcing contract with Peak Collections would run until the entire book has run off.
The living will provider does not hold HMRC ISA Manager Status, so an agreement has been confirmed with a further third-party compliance solution provider to provide IF-ISA manager services within 2 weeks of a trigger event through a one off set up fee and a fixed monthly service fee funded through revenue from the loan-book.
Loan Agreement Administration
The loan agreement administration processes would pass through to the
living will provider. All information, instruction, data, and access will pass to the living will provider in line
with the contractual terms specified in the living will.
Contractual terms of our provider identify that the administration would be undertaken based on the agreement and application of resources to fully manage and complete the run-down of the loan-book. Resources applied will be proportional to the volume of loans being administered.
One of the key aspects of is the availability of the portal to lenders throughout the life of any loan. The portal is company owned and developed and is a low-cost maintenance activity. No restriction to this portal’s information is anticipated upon execution of a wind-down scenario or thereafter. All lenders would be provided unrestricted access to the system to allow their own monitoring of loan agreements to within which they are involved.
The WDP Financial Model (WDPFM) includes a set of assumptions that enables the Board to assess and estimate the revenue and costs of implementation.
The WDPFM illustrates the total cost expectation for loan agreement administration across the life of the loans in the firm’s loan-book. This is reviewed and updated on a bi-annual basis and presented to the Board for their review to assess whether the WDPFM is financially feasible.
The current estimate of the minimum adequate cost on a month-by-month schedule are shown in the WDPFM.
The WDPFM includes an assessment of the level of capital required to meet the firm’s capital resource requirements as specified by the FCA/PRA.
Following the Portfolio letter received in May 2021 and using the guidance from FG20/01 surrounding liquidity monitoring an adequate “buffer” is regularly calculated and ringfenced separately in a liquid form. See details in the WDPFM.
The two main resource requirements for wind-down are people and systems.
eMoneyHub operational systems are fully owned. They are fully transferrable upon trigger of the wind-down plan.
Being a start up technology led finance firm, it is used to operating with limited resources and operated for 2 years with a governing Board and 2 members of staff.
The key individual is CEO and significant shareholder Lee Birkett. It is inherently in his own interests to stay to wind-down the business so additional financial resource would not be required for his retention. Additional administration resource can be adequately met by 1 FTE.
It is agreed with the living will provider that resources will be provided which are commensurate with the workload expected. Additional resource is the responsibility of the living will provider.
This plan is part of the compliance monitoring programme and is entered into the calendar of activities. It will be reviewed on its anniversary and re-approval sought at Board level.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED AGAINST IT. IF YOU ARE THINKING OF CONSOLIDATING EXISTING BORROWING YOU SHOULD BE AWARE THAT YOU MAY BE EXTENDING THE TERMS OF THE DEBT AND INCREASING THE TOTAL AMOUNT YOU WILL REPAY.