Health, Wealth & Happiness
Here’s a list of newsletters that I am subscribed to. I save most of the articles I receive into Pocket and then read the best of those during any downtime I have during the day. Apart from these newsletters, I also consume a lot of content through podcasts and through RSS aggregation websites such as Euro Finance Blogs.
Launched in 2017, PeerBerry has been gaining quite a lot of popularity among peer-to-peer platforms recently. As with many crowdlending platforms, PeerBerry originated in the Baltics – specifically Riga, Latvia.
At the time of this review, the platform has an average annual investment return of 11.51%, a solid return for most platforms. With more than 18,000 investors and over €212 million in funded loans, PeerBerry is certainly making some waves in the peer-to-peer business.
Let’s delve deeper into how PeerBerry operates, its transparency, risks, and returns.
PeerBerry works in a similar way to Mintos, in that, it is a loan aggregator. The platform started out in 2017 with loans originated solely by Aventus Group – a group of digital loan originators with short-term, long-term and leasing loans across Europe and Asia.
Ever since, PeerBerry has continuously expanded its loan originators network to include others such as Gofingo (another group of loan originators) and their subsidiaries.
This increase in loan originators allows for a diverse portfolio. PeerBerry claims to offer a wide variety of loans – short, long, real estate, leasing, and business loans – although, the available investment opportunities at the time of this review were mostly short term, with most maturing at one month. This means that most of the loan originators are operating with payday-style loans.
The platform offers loans from:
It is important to note that all of PeerBerry’s loan originators offer a BuyBack guarantee, meaning that the loan originator is obligated to buy back the claim, should the payment be delayed by more than 60 days.
Now let’s take a look at the online interface.
The website is clean, straightforward, easy to use, and comes in three languages:
Registration should take you no longer than a couple of minutes, you just need to fill in a few details and you’re in. Although there is no tedious identification process upfront, the platform requires it eventually, when you decide to withdraw your funds.
You will be asked to scan and upload your identification document (passport or ID card) as part of the platform’s anti-money laundering and terrorism process. Once this is done, you will then have to make a transfer to the bank account from which the deposit was made. Withdrawals can only be done in Euro.
This is the first time I’ve ever come across this sort of set-up. All other P2P platforms require you to verify your identity at the get-go, thus ensuring that the funds used to power their investments are coming from lawful sources.
It is certainly odd that you are only required to verify your identity at the withdrawal stage. As an investor, I want to make sure that I will be able to transfer my funds without any identity issues at a later stage.
Upon contacting the platform, PeerBerry has announced that it is currently working on implementing new identification and KYC processes.
PeerBerry makes it possible for both private individuals and companies to open accounts. Keep in mind that any investor should be at least 18 years old, with a bank account registered in the European Union.
The next step is to transfer your funds, which can be as little as €10, to PeerBerry’s bank account in order to start investing.
The platform accepts transfers in Euro only using SEPA (Single Euro Payments Area) transfers. This provides further protection for European investors against currency swings.
Processing may take up to 2 working days. PeerBerry then sends you a confirmation e-mail stating that your deposited funds were added to your Investor Account and you are now able to start making investments.
PeerBerry offers mostly short-term loans on the consumer marketplace. The platform presents you with an overview of each loan, including the loan originator, amount, interest rate, remaining principal and days remaining for investing in the loan.
Borrower details are also available. These include the borrower’s country, city, age, gender and number of loans taken.
Since most of the loans available mature in around 30 days, they are often considered to be Full Bullet loans. This means that the investor would receive the principal and interest at one go, through one payment, at the end of the investment period, as illustrated in the schedule in the screenshot below.
On the other hand, the platform’s long term loans are paid back every month through an Annuity Type Schedule, where the principal and interest are paid back periodically over the investment period. PeerBerry offers a breakdown of the returns for each investment available.
The platform allows investors to make use of their Auto Invest feature which uses the returns in your account to automatically invest in active loans, based on your preferences.
You can activate, pause, or cancel this feature at any time. Simply set up your preferred criteria for investing and you are good to go.
The possible setting options are listed below:
Interestingly, even though PeerBerry states that all its investments come with BuyBack guarantee, their Auto Invest asks whether you prefer a BuyBack guarantee or not. This seems to suggest that the platform has plans to include investments without BuyBack in the future.
Auto Invest is great for those of you who do not wish to spend time keeping up with all the available investment opportunities on the website, while still achieving a diverse portfolio.
The About page, shows a team of four, including Arunas Lekavicius, the platform’s CEO, who has been working in the financial industry since 2007.
The profiles are accompanied by working LinkedIn profiles, however, no further information is found on the platform’s website. It is strange that the rest of the team is not shown here, especially with respect to the CTO, Marketing Managers, and Lawyer.
On reaching out to the platform, PeerBerry has clarified that the team is made up of a total of 9 employees:
The team was quick to answer any of my queries in detail and in record time, which reflects positively on the entire company. The website has an online chat function for any customer queries. Should you have a number of questions, you will most likely be instructed to send an email to [email protected].
PeerBerry offers a loyalty program to investors who have been members for more than 90 days. The program is based on the amount of money you have invested and comes in 3 levels:
This means that if you are a member of the Silver Program, for instance, and invest in a loan that provides an 11% return, you will automatically be upped to 11.5%.
One of the main risks with any peer-to-peer platform is Loan Originator default. PeerBerry offers an additional guarantee, further to the BuyBack guarantee mentioned above, specifically for such potential cases.
The platform stated that their main partner, Aventus Group, has signed an additional guarantee agreement. This means that in case of loan originator default, Aventus Group and Gofingo will “do everything … to protect your investments, maintain transparency and good reputation of all partners – loan originators”, as A. Lekavičius explains on their blog.
80% of total loans on the platform are accounted for by Aventus Group, with Gofingo following at 15% and Lithome at 5%.
It is important to note that in 2019, Aventus Group posted a net profit of €12.6 million, whereas their equity stood at €14.3 million. These figures suggest that the company would be able to cover any liabilities, should they come up. A comprehensive article with Aventus Group CFO comments can be found here.
Who can invest in PeerBerry?
Investors must be 18 years old and over, with a European bank account. Both private individuals and companies can join the platform.
Who are the loan originators?
PeerBerry provides a comprehensive list of loan originators, together with a description of each originator. You can view the whole list here.
Does PeerBerry have a Secondary Market?
No, PeerBerry does not have a secondary market at the moment.
Do I get the same interest on overdue loans?
Late or overdue loans generate the same interest per annum as current or active loans. They cover the delayed period, until the borrower makes a repayment or until the loan originator buys back the investment.
Do I pay taxes on my returns?
Taxes are not deducted by the platform on investments made by private individuals. It is the investor’s responsibility to pay the taxes on any income made through the platform. Taxation is based on the legislation of your respective country of residence.
Can I cancel my investments?
PeerBerry does not offer this option at the moment. They are, however, working on implementing this functionality on long term loans in the near future.
Will I be notified of any new investments?
PeerBerry sends out newsletters to whoever signs up to the service. They include monthly reviews, as well as alerts for any new investment opportunities and new loan originators.
PeerBerry offers a multitude of investment opportunities, specifically with respect to short term and long term loans. The platform has been continuously expanding its loan originator network, which I believe is a step in the right direction.
As with many peer-to-peer platforms, PeerBerry offers an Auto Invest function and a BuyBack guarantee. Unfortunately, however, no secondary market is available yet.
The platform presents you with daily/weekly summaries of your transactions, as well as the ability to generate tax statements. This is a great tool to facilitate the monitoring of your investments. Keep an eye out for their blog for any important and new information they may publish.
One of the decisions to make as an investor is whether to invest in gold and other precious metals. Gold has been a highly valued, precious metal for most of human history. From the Egyptians, to the first Roman gold coins, right through to the current day; humans continue to have a fascination with the dense, yellow metal.
During the last financial crash of 2008 and shortly after, we saw many people hype up gold as the best investment of the time. It’s true that for a number of years the price rose sharply as people were looking for something stable to put their money into and there was a lot of doom and gloom due to the state of the economy.
Unfortunately, most pundits and advisors recommend gold before a big gold crash. It’s latest heyday was 2011, after the price had increased 24 percent in 2009 and 29.3 percent in 2010. Until the average investor got to know about the “opportunity” and made arrangements to invest, however, it was already too late. Institutional investors had already made their money and started to sell, helping gold drop 37 percent in 2013 from its 2011 high.
If we take a sensible look at gold in 2020 and look back as far as we can, it is very clear that gold has not produced good returns that can compare in any way to other investments such as real estate or stocks.
Professor Jeremy Siegel, of the Wharton School of the University of Pennsylvania, looked at the data from 1802 to 2008 in his investing classic “Stocks for the Long Run”. He found that if you invested $10,000, and reinvested all the dividends and interest, this is what you’d have (adjusted for inflation).
Investing $10,000 in stocks would give you $5.6 billion, bonds $8 million, and gold $26,000. This is because stocks return about 7%, bonds 3.5%, and gold, well, it’s not very good. So we know gold isn’t the best investment.
We can, therefore, extract our first important conclusion.
Gold considered purely as an investment is not an attractive proposition.
Why has gold generated such low inflation-adjusted returns over the long-run?
The reason is simple. Gold has no intrinsic value. It isn’t a productive asset.
What’s a productive asset? When you own an asset that produces goods and/or services to consumers, we can say that it is producing value and that it is a productive asset. A good business generates a profit and we can either start such businesses ourselves or invest in them through the purchase of stocks and bonds.
Gold returns in recent decades
I would say that if we’re looking at gold to make good returns, the only way to do so is to speculate, and that’s more akin to gambling than investing.
It is an asset that can fluctuate wildly and generate huge opportunities for those who are analysing the markets and the political situation around the world.
But in terms of productive growth, gold is a dead asset that will eventually return to its baseline. It produces nothing. It creates nothing. The inflation-adjusted returns of the past 200 years reflect this reality.
This is a post prepared in collaboration with Iban Wallet, one of my favorite investment platforms. The content below has been written by Filipe Silva on behalf of Iban Wallet. Hope you enjoy this contribution and as always, I’m happy to discuss things with you in the comments section.
These are exciting times for those who are looking to invest.
The fintech ecosystem has been experiencing considerable growth in the past few years and investments are no strangers to this phenomenon.
As options become more popular and widespread, it is natural that some misconceptions may appear. For instance, that all investment in fintechs are made exclusively using a P2P model.
P2P stands for Peer-to-Peer, and comes from the world of computing. It is basically a network set-up that is not dependent on central coordination.
What some fintechs have essentially done, is remove this central coordination from the lending process.
Meaning?
Borrowers and lenders are directly connected through a digital platform, with no traditional financial institution acting as a middleman. The result is the possibility for both sides to access better interest rates than it would be otherwise possible.
Yet, that can bring its own difficulties, since the lenders must actively assess the information available and decide on whether a particular investment is worthy of the risk.
Here’s some good news to start the week on a good note. I have teamed up with one of my favorite P2P lending platforms, Grupeer, to offer my readers the chance to win 150 EUR.
All subscribers who invest in Grupeer in the period from February 10th till March 10th will automatically take part in the lottery from Grupeer and get a chance to win 150 EUR!
Here are the terms of the raffle:
All new clients who invest 100 EUR or more into Grupeer
February 10th – March 10th
Three winners will get 150 EUR to their accounts in Grupeer
If you have not invested with Grupeer yet, now is a good time to do so. If it’s the first time you hear about Grupeer, make sure you check out my full Grupeer review to learn more about the platform.
Lottery winners will be announced on the 12th of March 2020!
Online Entrepreneur. Global Citizen. Padel Player.
Founder of WP Mayor & WP RSS Aggregator.
