Mintos P2P Lending Review: Pros vs Cons

There are many P2P lending platforms available in the digital lending pillar with many scams too. You don’t want to get yourself into any of them, that’s why you are reading this review. The first P2P lending platform review we want to do is with the currently perceived by most as ‘the best’ in the market – MintosWe want give a detailed review on our P2P lending experience with Mintos so far, the pros and cons and our tips/tricks to make better investment on this marketplace.

Is Mintos another online scam? No.

1.Mintos: Platform info
  • Company: AS Mintos Marketplace
  • Mintos Office: Riga, Latvia
  • Year founded: 2015
  • Website: https://www.mintos.com

 

  • Number of loans: 1,243,525
  • Loan volume: € 257,938,468 (25.07.2017)
  • Types of loan: Mortgage Loans, Car Loans, Business Loans, Agricultural Loans, Personal Loans, Short-Term Loan, Invoice Financing, Pawnbroking Loans
  • Buyback guarantee: Yes
  • Loan to countries: Albania, Bulgaria, China, Czech Republic, Denmark, Estonia, Georgia, Hong Kong, Latvia, Lithuania, Poland, Romania, Spain*

*Countries with underline are not having active loans at the time this post is written.

  • Number of investors: 29,866
  • Eligible investors’ countries:  Now available to 44 countries for individuals or companies with EU bank accounts or third countries with equivalent AML/CFT systems to EU’s.
    *All US citizens or taxpayers are out of the game on Mintos (SEC regulations/tax reasons) 
  • Secondary market: Yes    –    Volume: € 5 188 761   (25.07.2017)
  • Minimum amount per loan:  EUR 10, DKK 80, GEL 25,PLN 50  or CZK 300 on the primary market. No minimum for investments in the secondary market.
  • Fees: No for (opening investor account, service fee, withdrawal to bank account). Yes for loan sale in secondary market –  1%
2. How Mintos works?

Basically Mintos is a bridge between three parties: loan originators, investors/lenders and borrowers.

Screenshot: Mintos Business Model

3. Mintos P2P lending platform: My experience after one year investing

The ultimate question you are asking yourself to be searching around and reading this article:

Is it safe to give money to people I don’t know on the Internet?

The answer is yes and no. Yes, when you find a good vehicle, a reliable platform with fairly secured offers to do it. No, send money to random people without any security of how you can get your money back.

That leads us to the first point about security, your chance of getting back your money in case of default.

  • Security: Mintos offer Buyback guarantee is a term applied when you loan is 60 days over due. In such case, Mintos will buy back the loan automatically. However, Buyback gurantee is made by loan originators just case they are not going into insolvency, so it is not 100% suecured with the term. Still better than nothing. Also, Mintos offer car loans and mortgage loans which are considered   more secured loans  than other loan types.

Screenshot: Mortgage loan and car loan share on Mintos (25.07.2017)

  • Short-term loans dominate in loan type with the highest number of loans offered. This loan type offer attractive interest around 10% for 30 days less term, which means 100% on annual return.

Screenshot: Number of Short-term loans on Mintos (25.07.2017)

  • LTV (Loan to Value): is the lending rate. If LTV is high, it means there is a high of risk the loan going to default because the borrowers asks for a loan is near its appraised value, there is little room for equity to build up. On Mintos, this is applied mostly to sercured loan type such as car and mortgage loans since the value can appreciates over time. Other loan types such as short-term loans, personal loans mostly usually guarantee with Buyback term when overdue so LTV does not apply, as the nature of these loan types do not appreciate in value.
  •  For example in the screenshot below, Someone from Geogia wants to borrow 125 euro and want to pay back in 30 days, which is a short term loan, and is willing to pay 10.5% interest. Then he went to Creamfinance (loan originator) to ask for it. Creamfinance already funded 68% at 85 euro and left 32% room for 4 investors to invest 40 euro more (we know minimum investment per credit is 10 euro). On the left column, LTV is not applicable because the Buyback guarantee from CreamFinance has overrided  LTV. LTV and Buyback guarantee varies case by case, so you need to be careful with the Buyback guarantee term and LTV more than 80% .

 

  • Pre-finance secured loans. Car loan is a secured loan with interest 13 – 14% a year. The good thing with Mintos is either their loan originators or themselves pre-finance the secured loan and leave investors a small share but low-risk. That means that you when you invest get interest from day one of investment.
  • For example from screenshot below, a car loan of 7,010.03 euro to someone in Poland where Mogo (loan originator) already invested 80% and left 20% for the investors. You can get your share by contributing minimum 10 euro or increase the amount depending on your risk-return assessment. If you are new, go low to minimise risk. This loan comes with LTV equals 57% which is quite fair, not too risky. In case of default, we can sell the car (liquidation) and can get the money back easier.

Screenshot: Car loan – secured loan with low LTV, low risk.

  • Fast deposit/withdrawal: It takes less than 2 business days to deposit or withdraw money to my bank account. It is fast and reliable and the one thing that everyone will love is no fee applied!
4. Mintos Primary Market: Manual Invest vs Auto-invest
  • Mintos Manually invest: the interface is well designed with good, clean interface where you can hand-pick and filter loans on your own terms and conditions. It is easy to use and responsive, no confusion found at the beginning.  After you set criteria for filter, you can click on the right corner ‘My Filters’ to save your preferred conditions for fast filter in the future. Here you are able to invest in single loan at a time if you have time to do so. Or not? Keep reading.

    Screenshot: Interface for Mintos Manually Invest Feature.

Screenshot: Some filter condition for Mintos Manually invest feature (more conditions)

  • Mintos Auto-invest feature: Although manually invest fuction is not bad but ‘Aint no body got time for that’. That is why auto-invest is not a want, it is a need. We need diversification as the number rule for investment. Here you can set different investment strategies for multiple portfolios, set the limit to your portfolio size, expected interest range, loan types and Mintos auto invest will match all the loans available accordingly. When you are happy with the matching results you can then “activate” the auto-invest. Mintos is leading the game with this feature for a while where Bondora just introduces Bondora Portfolio Pro this July 2017.

Screenshot: Choose Currency, loan types in Mintos auto-invest

Screenshot: Determine interest rates and loan maturity terms in Mintos auto-invest

Tips: Always say “yes” to reinvest option since we want the most powerful force  the world (Albert Einstein) – compound interest effect. As we have talked about in last article What is compound interest in P2P lending?

 

Screenshot: Set limit for Portfolio size, range for investment amount per loan in Mintos auto-invest

After you set all your terms you can view the visualised charts by clicking “Show summary” or see all matching loans in details by clicking “View all loans”.

Screenshot: View matching loans in charts by Amount/by Number- Mintos auto-invest

Screenshot: View all matching loans in details

Auto-invest works perfectly is all I have to say.

5. Secondary market

Mintos have secondary market for you when to buy and sell loans that go into default for when you need urgent lidquidity. The premium can go up to 20% and discount can be as low as -20%. Usually I will sell my default projects on this market at 4 – 5% premium so I can sell quickly. And always keep that 1% fee on profit applied for secondary market when you want to buy and sell here to set a fair price.

 

Screenshot: Secondary market Mintos

 

Screenshot: Growing volume for Mintos secondary market

 

6. Mintos P2P lending: Pros vs. Cons

  • Pros

-Secured loan

-Buyback guarantee

-Attractive return: average 12% can be up to 18%

-No fee: applied for opening account, service, primary market. Except  1 % for secondary market

-High number of loans available

-Good investor relation/support: Quick reply and improvement according to investor’s feedback.

-Good auto-invest for diversification:  multiple portfolios different terms

-Fast money transfer: no exchange risks in EU zone

-User-friendly design: good UX, can’t complain

-Multiple Language support: English, Latvian, Russian, German.

-Mobile-friendly: good. Other platforms like Bondora still struggle with mobile version

  • Cons: nothing I dislike until now, one of the best platform in my portfolio
Conclusion

Mintos is my favourite Europe-based P2P lending platform. It gets quite a bigger share in my P2P investment portfolio. So far everything works well, all the my default projects are bought back automatically by Mintos. The yield is better compared to that of platforms in Europe. It is a reliable, works flawlessly. Highly recommended.

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