Welcome to my latest monthly update of my P2P portfolio, this time for the month of March 2020.
I thought it’s impossible, but this year keeps getting worse. Pretty much all of my assets (except cash) are currently in the red. And just as I was thinking my investments in P2P lending could help stabilize my portfolio, something else happens.
Let’s get right to the important part, before taking a look at the rest of my P2P platforms.
Grupeer: What we know so far…
Here are some of the things that happened since last month:
- Grupeer stopped processing withdrawals in mid- to late March, even though these funds are displayed as “available” on accounts
- The company fired most if not all of its employees
- Grupeer issued two statements on its blog, blaming Covid-19 for all of the issues
- It seems like some of their Russian loan originators and development projects were fake
As a result, as it stands, there is strong reason to believe that they’ve been scamming us investors. I can’t believe I’m saying this right now.
While I was slowly losing trust in the platform’s management over the past few months and even decided to leave Grupeer (once again too late), I would have never guessed that this would happen.
Grupeer was working with many loan originators that are also active on other P2P platforms. Heck, I even met them in their Riga office last year in May and both Vlad & Alla were speakers at the P2P Conference. I remember my wife telling me she wanted to open a Grupeer account after she heard them speak.
Throughout our conversations, I had the impression that they were good, honest people. And so did everyone else who visited them with me last year. Yes, they were a bit chaotic and sometimes inconsistent in some of their replies, but I never for a second believed that they had bad intentions.
And yet, here we are – the current situation is looking more and more like an exit scam by the platform.
While we can’t confirm that (yet), legal action against Grupeer is currently being planned by a few investors including Guillermo, who is also working on the Envestio & Kuetzal case, to be prepared for this worst-case scenario.
You should know that I have very little experience regarding these matters and I can’t give you legal advice, but I will personally be joining the case once it starts.
I hope I’ll have better news to share in the coming weeks…
Ok, I have to say that this platforms “temporary” closure was less of a surprise than Grupeer. Back in January, I shared my concerns and reasons why I was leaving Monethera.
After I received a withdrawal in Mid February, I was hopeful things might still end well, but then Monethera announced that they were “forced to temporarily close down” because of Covid-19.
Here was their announcement:
It now looks like I made a mistake by not selling my loans at a discount when it was still possible. Apart from ever testing the platform in the first place, of course.
Since I’m having a hard time believing that they were unable to process withdrawals due to Covid-19, I decided to join the lawsuit in this group. If you want to do the same, check the pinned message there for announcements and how to sign up as well.
Hopefully I’ll be able to recover some of my outstanding account balance (1.151€).
That now means I will be actively participating in legal action against three platforms. There is no way I would have believed you if you told me at the beginning of the year this was going to happen.
P2P Lending Income – March 2020 Overview
|Wisefund||0||-11,41%||60€||0 (Exit fee)|
*I’m not counting any Grupeer income for March. I will be counting Grupeer as a loss if things don’t improve in the coming weeks.
**I counted Monethera as a loss for now, hoping to recover some funds
***After what happened, we’ll have to wait and see if/when we get some of the funds back from Envestio.
My income from P2P lending dropped to 262,87€ (-49,51€) last month.
If I don’t recover anything from Envestio and Monethera, I will have lost 972€ from P2P lending since starting this journey on September 1st, 2018.
If the situation with Grupeer doesn’t get resolved either, my total losses will be 4.158€ (12% of my P2P investments!), not taking into account any potential recoveries from these three platforms.
My blog’s slogan “Adventures in P2P Lending” is definitely fitting so far, although I might have to change it to “Misadventures” if the situation worsens. Bad jokes aside, my hope is that we’re able to learn from this, to make better decisions in the future and avoid this from happening again.
Ok, now that the worst part is out of the way, let’s see how the other platforms have been performing last month.
- Income (March 2020): 34,02€ (+0,43€)
- IRR: 13,97%
- Invested since: 05.10.2018
I haven’t noticed much of a difference in loan performance or delays on Iuvo Group last month, which I’m happy to see.
- Iuvo Group’s Covid-19 response
- Don’t forget to take advantage of the 90€ Refer-a-friend Bonus, if you’re interested in Iuvo Group.
- Income (March 2020): 123,75€ (+32,33€)
- IRR: 13,05%
- Invested since: 27.09.2018
I added 500€ to my account on March 12th, to take advantage of the higher interest rates that are currently available on Mintos.
Mintos Invest & Access – Withdrawing
- Income (March 2020): 6,18€ (-0,88€)
- IRR: 9,77%
- Invested since: 12.06.2019
Mintos Invest & Access has been a big disappointment, to say the least. It was supposed to offer investors more liquidity, by being able to ‘cash out’ from most of the investments when needed.
While that worked well in the beginning, investors (me included) are unable to cash out most of their portfolio right now and find themselves in a situation with many long-term, lower interest rate loans in their portfolios.
As a result, I decided to end my Invest & Access experiment. I much prefer using the Auto Invest on my main Mintos account.
So far, I was able to withdraw 109,28€ from my Mintos Invest & Access account, let’s see how much is left next month.
Bondora Go & Grow
- Income (March 2020): 17,04€ (+1,17€)
- IRR (incl. withdrawals): 6,65%
- Invested since: 01.09.2018
Because of a substantial increase in Go & Grow withdrawals, Bondora implemented partial withdrawals recently.
Bondora Go & Grow was always designed to work this way in an extreme scenario, as there needs to be a balance between available cash for withdrawals and money that’s invested in loans, generating 6,75% per year on average.
Here is what that looks like in practice: I’m currently withdrawing 1.000€ from my Go & Grow account. From that, on average about 30€-40€/day are added to my main account balance, as Bondora receives interest and principal repayments from loans.
I can then withdraw that money from Bondora and usually I have the money back on my Austrian bank account the same day.
It’s disappointing that the money on Go & Grow isn’t instantly accessible right now. Still, considering the extreme circumstances, with unprecedented withdrawals from investors, I think this is the only way Go & Grow can work, while still generating returns.
- Bondora CEO shares an update on COVID-19
- You can get a 5€ Bonus on Bondora when you sign up via my link.
- Income (March 2020): 43,61€ (-3,8€)
- IRR: 11,54%
- Invested since: 03.04.2019
Just when I thought my internal rate of return was going to catch up with the average interest rate of the loans in my account, we get a worst-case scenario for business loans (coronavirus).
Crowdestor decided to give the businesses we invested in 3 months of extra breathing room under these extreme circumstances. Personally, I think that was the right call. Other well-known business loan platforms like October and LinkedFinance are following a similar approach.
However, that means I likely won’t have any earnings to report over the coming months and that I have to re-do the accrued interest on my graph.
Apart from that, I added 500€ to my Crowdestor on March 3rd, which I invested into the Leasing Loan Portfolio project.
Swaper – Withdrawing
- Income (March 2020): 12,35€ (-6,5€)
- IRR: 11,54%
- Invested since: 02.10.2019
After the problems with Grupeer, I made the decision to start withdrawing from Swaper. I’ll be back once audited financial statements are published.
Right now, I just need more information than what’s currently available and I don’t want to take unnecessary risks.
On March 31st, I made the first 200,92€ withdrawal from Swaper. The money arrived on my bank account two days later.
- Income (March 2020): 13,31€ (+1,68€)
- IRR: 10,01%
- Invested since: 11.10.2019
In March, Viainvest added loans from Romania, yielding 12% interest per year. I included them in my Auto Invest.
- Get a 15€ Bonus after investing 50€ or more on Viainvest by using my link.
- Why I added Viainvest to my P2P Portfolio & My Auto Invest Settings
- Income (March 2020): 12,61€ (-21,04€)
- IRR: 11,34%
- Invested since: 21.11.2019
The interest I earned on Lendermarket decreased substantially in March. That’s because >70% of my short-term loans are delayed.
On April 2nd, I had a spontaneous videochat with Omayra Roig, the business manager at Lendermarket, to discuss the sudden increase in late loans and other questions I received from the community.
She told me that a low percentage of late payments for short-term loans is not realistic in the current environment, due to Covid-19. The buyback guarantee still kicks in after 60 days, including interest for the late period.
Additionally, certain governments (eg. Spain) have introduced a debt moratorium for a certain period of time, leading to loan term extensions by Creditstar.
Since Lendermarket‘s system doesn’t support loan extensions, they’re displayed as delayed and bought back after 60 days on the platform, while in reality they’ve been prolonged and are still current on Creditstar’s side.
You can the questions and responses in this PDF I created here (updated with official answers!).
Apart from that, Lendermarket started adding Swedish and Danish loans to the platform on April 1st. You might have to edit your Auto Invest to include those countries if you’re planning to pick them up.
- You can get 1% Cashback on all your investments on Lendermarket after 60 days by using my link here. Additionally, Lendermarket is currently offering a +2% Bonus for all deposits until April 30th.
- Lendermarket Review
- Lendermarket’s new blog & updates
Nothing new to report from EvoEstate, as the two projects I invested in have a loan duration of 12 months and I won’t receive interest payments before the end of the loan term.
- Evo Investors update on Covid-19
- If you’re interested in EvoEstate, you can choose between their 15€ bonus or 0,5% cashback offer on this page.
As I mentioned in my last article, this is not a fun time to be an investor or a personal finance blogger. Nobody knows what the future holds in the current, unprecedented economic environment we find ourselves in. And nobody likes sharing bad news.
After all, these are the kinds of articles that are the hardest to write and later record as a video. I hope they’ll still serve as a valuable, yet expensive lesson to me and to others who see them over time.
I wouldn’t even be surprised if a lot of P2P blogs suddenly disappear after the unexpected events surrounding Grupeer, however that chapter may end.
I also have to be honest, after all these events, I’m way less excited about P2P lending than I was in the beginning of the year. Nonetheless, I’m not going anywhere and I’ll keep sharing my successes and failures.
I still believe in this asset class as a whole. It will be interesting to see how it fares and matures over a longer time horizon and through different market cycles. P2P lending aside, I’m planning to spend more time discussing other asset classes as well in the future, so stay tuned for more on that.
Last but not least, thank you for taking the time to read my latest monthly update, thank you for all of the support and please take good care of yourselves.
You might find this useful:
- P2P Lending During Coronavirus
- Current P2P Lending Bonus and Cashback Offers (April 2020)
- My Entire Investment Portfolio
- How To Track Your Investments In P2P Lending