Top P2P Lending Platforms that Offer Auto-Invest Tools
Peer-to-Peer lending is an emerging asset class that allows anyone to be a licensed borrower and lender without having to use traditional banks as intermediaries. This emergence reduces a lot of the overheard and bureaucracy cost that traditionally comes in our current banking systems. Peer-to-Peer lending enables borrowers to receive better interest rates than banks and allows lenders to receive higher interest rates than they would with their money in a savings account.
Aside from banks, traditional investing options require toם much time, due diligence and commitment in order to attain real gains. Many innovators and pioneers of Peer-to-Peer lending platforms began with the idea of providing hassle free investing to everybody. The fruit of their efforts: the auto-investing tool.
The auto-investing tool is one of the greatest features Peer-to-Peer lending platforms have to offer private investors. The auto-invest feature allows investors to choose the parameters of where they would like their capital invested. Various Peer-to-Peer lending platforms offer loans from all over the world, with different loan cycles and different levels of risk.
Market Type
Consumer Loans
Average Returns
9 - 12%
Minimum Investment
EUR 10
Signup Bonus
0.5%
Registered users
70,000
Total funds invested
EUR 1.8 Billion
Default rate
7%
Regulating entity
Self-Regulated/EU Compliant
Buyback guarantee
Secondary market
Payment methods
Bank Transfer, Bank Card, TransferWise
Withdrawal methods
Bank Transfer, Bank Card, TransferWise
PeerBerry is an excellent P2P platform to its 100 percent successful fund recovery track record. They offer slightly below market interest rates in exchange for a guarantee users will never lose their funds.
Market Type
Mortgage Loans
Average Returns
8 - 13%
Minimum Investment
EUR 50
Signup Bonus
0.5%
Registered users
150,000
Total funds invested
EUR 700 Million
Default rate
6%
Regulating entity
Bank of Lithuania
Buyback guarantee
Secondary market
Payment methods
Bank Transfer, SEPA, Credit Card, TransferWise
Withdrawal methods
Bank Transfer, SEPA, Credit Card, TransferWise
EstateGuru is a highly recognized and successful P2P Lending company. What makes EstateGuru as P2P Lender so profitable and secure? Explore the breakdown with P2PIncome's thorough analysis of EstateGuru's strengths and weaknesses.
Market Type
Consumer Loans
Average Returns
14 - 16%
Minimum Investment
EUR 10
Signup Bonus
None
Registered users
6000
Total funds invested
EUR 400 Million
Default rate
Undisclosed
Regulating entity
Self-Regulated/EU Compliant
Buyback guarantee
Secondary market
Payment methods
Bank Transfer
Withdrawal methods
Bank Transfer
Swaper only offers auto investing in unsecured consumer loans in Poland and Spain. Swaper is a subsidiary of Wandoo Finance Group, a loan originator that also services the loans on Swaper's platform. Swaper advertises a 14% IRR and premium investors who have invested over 5000 EUR receive an IRR of 16%.
Market Type
Consumer Loans
Average Returns
6%
Minimum Investment
USD 25
Signup Bonus
USD 50
Registered users
Undisclosed
Total funds invested
USD 23 Billion
Default rate
3%
Regulating entity
U.S. Securities and Exchange Commission
Buyback guarantee
Secondary market
Payment methods
Bank Card, Bank Transfer, Credit Card
Withdrawal methods
Bank Card, Bank Transfer, Credit Card
Prosper is the first ever P2P lending platform to come out of the US. They are second in the US only to Lending Club. Prosper specializes in consumer loans, micro finance and debt consolidation.
Market Type
Consumer Loans
Average Returns
9 - 12%
Minimum Investment
EUR 10
Signup Bonus
1%
Registered users
500,000
Total funds invested
EUR 8.9 Billion
Default rate
16%
Regulating entity
Financial & Capital Market Comission (Latvia)
Buyback guarantee
Secondary market
Payment methods
PayPal, Bank Transfer, Credit Card, TransferWise
Withdrawal methods
Wire transfer, Credit Card
Mintos is P2P loan originator aggregator whom after years of slow growth exploded and became the number one P2P lending platform in Europe. Find out why in this review. Is Mintos an investment worth considering?
EstateGuru
EstateGuru offers mortgage or real estate lending. They connect borrowers and lenders on their platform to participate in a lender/ borrower ecosystem. EstateGuru is one of the top platforms in regards to loan size, loan success and fund recovery success. EstateGuru has a 50 EUR minimum entry, a 10 - 12 percent yearly return and can guarantee their investors that they will not lose their principal. EstateGuru was founded in 2013 and has shown their policy of safety can withstand the test of time.
EstateGuru has the option to auto invest after depositing 250 EUR into the platform. When loans are offered on the market they are very quickly filled out. Even users who have opted for emails and notifications will find that the available projects are quickly snatched up. Although there are new projects being uploaded frequently, users can expect to experience a bit of a cash drag on their portfolio.
Auto-investing can be difficult to optimize. The more specific the parameters of the auto-invest tool the more difficult it will be to invest in projects. On EstateGuru, especially because deals get eaten up very quickly, we highly advise adjusting location and risk level, regularly. The loans on EstateGuru have historically been sound and profitable.
PeerBerry
PeerBerry is one of the fastest growing Peer-to-Peer lending companies in the world today. Founded in late 2017, they have been gaining unprecedented momentum. PeerBerry is the product of loan originator and private lending organization, Aventus Group. Minimum deposit entry on PeerBerry is 10 EUR and projected yearly return ranges from 9 - 12 percent.
Aventus Group services the majority of lending on PeerBerry and lenders take a cut from Aventus' overall lending portfolio. This strategy is to ensure the health of the lending ecosystem while still providing profit and liquidity to private investors. PeerBerry has only one investing option by which, investors choose where they would like to invest, the duration and amount.
PeerBerry has an impressive track record when it comes to defaulted loans and fund recoveries. PeerBerry stands by having a slightly lower return on their investments because of the amount of security and risk management they dedicate to their investors.
Swaper
Swaper was founded in Latvia in 2016. They offer unsecured consumer loans that range from 50-1500 EUR. Swaper only has one auto-investing tool where lenders select the location and amount invested.
All loans are 30 days on Swaper and interest is fixed at 14%. Those who invest over 5000 EUR receive an additional 2% on their yearly returns.
Swaper offers no manual investing on their platform, investors may only use the auto-investing tool. There is a secondary market whose sole purpose is liquidity or purchasing loan notes at a reduced cost. Swaper's most enticing feature for any investor, there are absolutely zero fees.
Swaper services only one loan originator even though their platform is designed for more. The LO is Wandoo Finance, a company that loans capital to financial technology companies around the world. Wandoo Finance is also the organization that built and owns Swaper. There is a firewall, so to speak, between Swaper and Wandoo Finance. Even so, the success of Swaper is heavily dependent on Wandoo Finance which may prove to be a difficulty in the future.
Prosper
Prosper is the largest Peer-to-Peer lending platform in the US. They offer unsecured consumer, long term loans, mainly specialized in debt consolidation. And a humble return of 7 - 9%. While they may not have collateral or a buyback guarantee, Prosper reports a very low default rate of 3%.
Prosper offers one auto-investing tool which allows lenders to select the loan duration, invested amount and location. Prosper's only issues loans out within the US and investors need to be accredited in order to enjoy Prospers platform. By SEC regulation, investors can only invest up to 10% of their overall investment portfolio.
Prosper has only one investing option, by which investors choose where they would like to invest, the duration, and the amount.
Mintos
Mintos is a loan originator aggregator based out of Latvia. Mintos offers a variety of both secured and unsecured loans based on the conditions of the loan originator. Most loans are either auto-loans or consumer loans. Mintos' marketplace has a minimum entry of 10 EUR and a projected IRR of 9 - 12 percent. They have been operating since 2014 and currently hold the number one position in Peer-to-Peer lending in terms of portfolio size, investor count and amount of loan offerings.
Mintos auto-invest tool comes in three options:
- Diversified
- Conservative
- High-Yield
Mintos has encountered controversy with loan originators on their platform defaulting and refusing to enforce their buyback guarantees. Nonetheless, Mintos is still one of the safest Peer-to-Peer lending platforms with attractive yields on their auto-invest programs.
Potential Risks with Auto-Invest?
Auto-Investing is a tool which investors may use to automate their investing decisions. The risks are highly dependent on the factors that investors choose. When using an auto-invest tool there is still a certain degree of due diligence that needs to be done. When selecting a country or state, be it in the US or Europe, an investor should understand the states with a smaller GDP are potentially at a higher risk than those with high GDPs. For example, granting a loan to a business in the US might be more reliable than granting a loan to someone from Romania.
Other platforms give their lenders the ability to choose what level of risk they would like to engage with. The risks range from A rank to E Rank. 'A' ranked loans return a low yield. Whereas, 'E' ranked loans return a much higher percentage, given, the lower the rank the higher the chance the loan will default.
In short, the risk factor associated with Auto-investing is directly related to parameters chosen by the investor. Auto-investing tools trigger as new loans are being introduced. However, lenders can experience a cash drag on even reliable, high volume marketplaces, because of auto-investing parameters being too specified.
A solution is, an investor must update himself daily of the performance of his portfolio until he sees all investments filled up. Only once the money is invested, Peer-to-Peer lending becomes more hands off and hassle free.
Platforms That Reject Auto-Invest
Many platforms do not believe the auto-investing tool is the way to a healthy, functioning lending ecosystem. Their position is that it encourages investors to be blindsided by the platforms and make decisions that may not be in their best interest.
To name a couple:
- October
- Reinvest24
Verdict
Auto-Investing is an incredibly convenient tool for those who simply do not have time to learn about investing. Auto-Investing is easy, simple, straightforward, and if the results are below average one platform then there are always auto-investing alternatives on other platforms.
It cannot be stressed enough that an auto-investing tool does not mean an investor should not do his due diligence. It is very important that an investor knows where his money is going and what is being done with it. If a platform only offers auto-investing, then that is a big red flag. There is no reason for a platform to disable manual selection. An investor should always be in charge and aware of the movement of his or her capital.
What has been noticed is that platforms with an auto-invest feature often dedicate much less resources and time to the transparency of their platforms. Whereas, sites that are adamantly against auto-investing tools release an abundance of information for their lenders to do their due diligence.
We highly recommend any investor who is interested in the auto-investing tool to:
- After configuring the auto-invest, observe if there is cash drag on the portfolio
- Optimize auto-invest when necessary
- Notice the loans that are being filled up and if they are in accordance with your preferences
- Track the monthly returning of your investments
- Repeat at the end of each loan cycle.
These steps will help guide any investor who is uncertain of the necessary steps to take for using an auto investing tool.
So far, EstateGuru offers the most comprehensive auto-investing tool. If you're interested in simply letting the platform invest for you, then Mintos may be the choice for you.