Borro, the world’s first online asset lender, are to advance loans against high-value items being consigned for sale by auction or private treaty. The company have devised a scheme whereby they will loan up to 70% of the estimated sale price of assets valued between £50,000 and £1m, such as fine art, jewellery and wine, recouping their costs and fees once the sale has been completed.
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
"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
"We will liaise with galleries and private buyers negotiating
the terms to ensure the process is streamlined and effortless,"
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
"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.