Nowadays, we are going through uncertain times. That’s why I decided to diversify in the P2P sector and set up an account on Bondster platform.
Bondster is a Czech FinTech company that offers investment in loans. It works very similar to Mintos as it is an loan market as well. It links investors with lenders and opens new opportunities for investors who desire to achieve decent returns easily and without deep knowledge of the financial markets. You can invest in many loans provided by different companies on Bondster market. The loans are often secured by property or buyback guarantee.
As at March 2020, there is 9 283 investors who have already invested 42 583 300 EUR. So it is not a small platform at all. You can invest with various providers from different parts of the world in Euro and Czech currency.
You may be wondering why I decided to invest in P2P when the stocks are currently cheaper? Personally, I think diversification is the key to success. Stock markets may go down for a while, while the P2P sector offers decent return of over 10%. On the other hand, coronavirus might damage loan sector as well as stock markets. Therefore it makes sense to diversify risk across the platforms (Mintos x Bondster) and across loan providers.
Risks and disadvantages
As mentioned above, there is a real risk related payment discipline associated with coronavirus, which might affect the liquidity of loan providers. Therefore, I would be very cautious with the choice of providers at this time and I would definitely invest only in loans with a buyback guarantee. In my opinion, there are some safe options such as czech provider Acema, founded in 2000 or Polish Mikrokasa, founded in 2006. Both companies have survived the last financial recession and their financial statements look quite solid.
Another disadvantage of the Bondster platform is the absence of a currency exchange from CZK to EUR and vice versa. I also miss the secondary market where you can buy or sell the loans. Bondster promises to address both points in the near future. Another one is a smaller amount of loans compare to Mintos. Bondster is not yet such a global platform as Mintos. Last but not least, Bondster services are charged a fee of 1% per annum of the amount invested. The fee is calculated daily from the currently invested amount (1% / 365) and the fee is charged once a month on the first day of the following month.
On the other hand user interface of the platform is nice with a solid offer of various loans. Moreover, support communicates quite quickly and CEO Jana Mucková often presents Bondster to investors in the media and at conferences. There is also lot of information such as financial statements and presentations about all loan providers. All of this adds to credibility of the platform.
Bondster is definitely a nice alternative to the traditional Mintos P2P platform. In terms of diversification, it definitely makes sense to have money in as many places as possible. Some economists say it is best to hold cash now. However, inflation is still high. In our country, for example, 3.7% per year. This means that if you hold cash, you can lose money as well. I have money with an interest rate of over 10% on Bondster, which is nice risk/reward offer. If you are interested in Bondster as well, feel free to register via the following link, which allows you to get 1% extra on your investment in the first 90 days.
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