Grupeer to offer new loan type at 15% with buyback

This post is also available in: Deutsch (German)

Maybe you asked yourself if I am nuts or not when I put Grupeer on the second place of my top 10. Well, at that point I already knew about the new loans which will pe put on the platform beginning next Tuesday. This and the other points which are in favour for the platform had some influence on my decision. Too bad that they now introduced their new loans in a bad way. If we are honest, who has understood that mechanism from that short email? Some weeks ago I was approached from one of their representatives who wanted to get my opinion on these loans and if they are suitable. It told them yes, but make sure you explain the mechanism completely in a transparent way. I guess they failed on that one. One reason might be that Grupeer wanted to be the first mover as I know there is at least one platform who is developing such a structur as well.

A scheme of the new loans

For a better understanding I have a scheme of the new loan for you, which should clarify the structure a little bit. The dashed line represents the border between the EU and Russia. There are several parties involved which does not make it easier. Another crunchpoint is that we have capital movements between the EU and Russia, and we do not know at this point how the authorities will react to that. Imagine it like this: You have two closed systems (EU payment system and the Russian on the other side). No there will be a connection established by both with entry and exit points. On these points the authorities monitor all transactions. As the relationship between the EU and Russia saw better days in the past I can envision that there is someone watching. This is one reason why (amongst others) that we will see weekly loan volume from 30 to 40k in the beginning. If all goes well, this figure can easily be multipled.

Conclusion

Be aware that this represents a new type of loan from a EU entity to Russian SME’s, where several parties between two countries are involved. The whole thing is untested and if it goes sideways I guess it will be difficult to retrieve the funds, and it will take some time. 15 percent yield don’t come without risk, as there is no free lunch 😉 Follow me to register with Grupeer

4 Replies to “Grupeer to offer new loan type at 15% with buyback”

  1. Hi,

    I just discovered your website which seems incredibly complete !

    Regarding Grupeer’s 15% Russian loans, allow me to disagree with your statement “there’s no free lunch”. I could grab a small piece of these Russian loans before they got sold out. They come with a buyback guarantee, triggered after 15 days.

    So, even if the loan structure itself is complicated, as an investor I don’t consider them more risky than the other loans on the platform.

    Am I missing something here ?

    1. Hi

      Thanks. I referred to the unproven system and the crossborder characteristics of these loans. I would rate them therefor riskier then the other buyback loans, but I see your point: buyback is guaranteed from the same institution, so if they fail with these loans, all other default as well.

      Regards

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