Nibble, a new P2P platform, has recently launched under its parent company, IT Smart Finance Group. The platform also has a partnership with Joymoney, a company based in Barcelona, Spain, as of 2019, that offers fast microloans of up to €300.
How Does Nibble Work?
The platform allows individuals to start investing from a minimum amount of €10 to a maximum amount of €10,000 per month in loans within the IT Smart Finance Group. Payments can only be done from bank accounts through Paysera, an international electronic payment system. This is done to further protect the investors’ personal data.
They offer two types of products to lenders:
Short- term loans (Payday loans):
- Loan amount – up to € 500
- Loan term – up to 30 days
- Loan amount – up to € 1000
- Loan term – up to 90 days
As investors, you can of course also invest in both types of loans.
The platform allows investors with European Economic Area bank accounts only to invest in loans issued to individuals in European and CIS countries, and Mexico. It offers automatic investments and a BuyBack guarantee. The platform states that investors will only receive very minimal information about the recipient of the loan – mainly the country and the amount of the loan.
Joymoney, another brand owned by IT Smart Finance, seems to be the pipeline for loans. These loans are given in Russia and Spain, with Mexico next on the list in 2020. These are not great markets in terms of default rates, so I would expect a high interest rate for my money given the extra risk involved.
My First Impressions
Nibble states that it “enables [their] customers to invest in non-bank lending products with guarantee” and that these investors “are guaranteed to receive a return up to 12% per year, even if the loan repayment is delayed by more than 30 days.” The repetition of the word “guarantee”, seen here in another quote from the website: “as opposed to other platforms Nibble has a high-level guarantee of investment security” does not sit well with me. No P2P website should be declaring guaranteed returns, especially one in its infancy.
The website comes in 4 languages, English, Russian, Spanish and German, although the English version has several grammatical errors. It also seems to target a younger audience, rather than a more mature, financially-intelligent one. This is portrayed by the platform mascot itself, as well as the number of youths shown throughout the website and the promotional video.
Now, this video is a head-scratcher. It shows Maxim Paschenko, the platform’s founder, with an obviously dubbed voiceover, explaining IT Smart Finance Group and its new P2P platform. I’m not sure what they were thinking with that, but it definitely doesn’t look professional or reassuring.
Nibble offers phone and email support. I would prefer to see live chat, as other competitors have been offering this for a long time already, and as an investor it’s my preferred way of solving any doubts I might have.
The wording of their support window is a bit strange as well. They ask site visitors to contact them if they “Found an error”. As an investor, I’m looking for a solid platform that is 100% up to standard, not a website asking me to double-check things for free and alert the platform if I see anything that’s off. That should be the job of their quality assurance and testing team, not that of the investor.
The platform operates under the law of the Republic of Estonia and its main team is listed on the website. Interestingly, none of them apart from Mr Paschenko feature in the video that is also shown on the About page.
The leading team members are all listed on the About page, together with a description about each individual and his/her experience in the industry. I like this, and they do seem to have a strong team in place.
While their legal address is in Tallinn, the team operates from Barcelona.
There are many excellent alternatives to Nibble that have all been around for a while, with Mintos leading the pack. Swaper, Crowdestor and Peerberry are also platforms I would recommend checking out as they operate with the same exact model for P2P lending but are much more stable than Nibble.
I have high expectations from financial investment platforms, and Nibble, as it stands today, does not pass my test. I feel that they don’t do a good enough job at explaining the risks of P2P lending to prospective investors. That’s all well and good for those of us who have been investing for a while, but I’m afraid that new investors might think that these investments are risk-free when they read statements like this:
Investments at Nibble are protected by a buyback guarantee. In case of non-payment of the loan within the due date, the Lender takes a buyback and interest duty of the loan for the overdue time.
We guarantee investment income of up to 12% per year, even if the loan payment is overdue for more than 60 days.
There is also the fact that Joymoney seems to be the only lender supplying loans to Nibble, and they are ultimately both owned by the same people, which doesn’t give any diversification options to investors, unlike platforms like Mintos which act as loan aggregators.
The Joymoney loan originator business might be a solid one, and the idea of building Nibble to eat into the P2P lending market could work well for IT Smart Finance, but they have some way to go before investors can feel comfortable investing through this website, in my honest opinion.
Since Nibble is still in its early stages, there is not much else that can be said at this point in time. However, I look forward to seeing how this platform grows and develops in the coming months. They will need to prove that they are not just one other platform that is trying to cash in on the P2P lending wave. The fact that they already operate Joymoney and have that part of the business figured out, coupled with a strong team, should put them in a good position to do so.
If you do decide to take the plunge and invest your money with Nibble, let me know how it goes.
There are better options for investing your money at this stage, and I’m not convinced of Nibble’s offering, although they have been improving over the past year since their inception.