Borro say they will protect their investment by managing the sale of items against which loans have been issued.
The scheme, which echoes the advance guarantees offered by Sotheby's and Christie's, targets those who need immediate access to cash, as borro chief executive Paul Aitken explained: "We know there is demand from consumers to be able to quickly access finance and, as this demand is not being met by banks and other traditional lenders, consumers may consider selling assets as an alternative.
"However, selling high-value assets for the right price may take several months for the appropriate auction or until a buyer comes along. With a consignment loan from borro, consumers get immediate access to finance, allowing them to invest in and maximise other opportunities. This also allows them to leverage borro's expertise at managing the sale."
When a customer accepts their contract online, borro process the payment by a bank transfer. "Typically a customer will have the money in their account the same day, and if their bank supports Faster Payments it can be immediate," said a spokesman.
Once the deal is done, borro's team of experts take over the entire sale process, determining the best channel - auction or private treaty sale - and whether to sell the asset within the UK or internationally.
"We will liaise with galleries and private buyers negotiating the terms to ensure the process is streamlined and effortless," they say.
If the item does not sell, they say they will continue to search for a buyer. Obviously, though, the longer the loan remains extant, the longer the borrower will be paying interest on it. Rates are dependent on the asset type and value and typically start from 2.49% per month.
However, clients can pay off loans early if they want.
"Customers will be able to pay off their loan, should they choose to, in advance of the transaction taking place, while borro continue to manage the sale process."
Surrey-based auctioneers Wellers have been the first to announce that they are partnering in the scheme, although they are offering loans from the lower threshold of £1000.
"All assets are stored in secure and insured specialist vaults and premises for the duration of the loan, so clients can be secure in the knowledge that the assets are safe," says Wellers managing director Chris Sykes.
