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Exclusive Interview: Smava expands p2p lending to Poland

wiseclerk 2 Comments

Starting Jan. 7th, the German p2p lending service Smava will launch it’s p2p lending platform in Poland. I interviewed Smava CEO Alexander Artopé.

The following interview was originally conducted in German language. Possible translation errors are mine.

P2P-Blanking.com: Mr. Artopé, why has Smava chosen Poland as target market for the international expansion?

Smava: For several reasons. Poland is a fast growing economy with approx. 40 million residents. In Poland the span between deposit rate and base rate is very high – approx. 15 percent. Therefore the smava marketplace will be very attractive for polish customers right from the beginning. And regulation in Poland does not require a bank for the p2p lending model. This keeps transaction costs very low.

P2P-Banking.com: There are already 3 p2p lending services established in Poland. How does  Smava plan to win market share as newcomer?

Smava: Compared to the active services smava is much more secure. Like in Germany it is a central product feature, that the risk for the lenders is transparently evaluated and can be factored into the calculation . To achieve this we cooperate with the polish credit rating agency (BIK).

P2P-Banking.com: How did you organize the operations? Does Smava have a branch or a subsidiary in Poland? Or do you operate from Berlin?

Smava: We have a subsidiary in Wroclaw, Poland, with a polish management team.

P2P-Banking.com: Where are the biggest challenges in international expansion: technical, legal/regulatory, marketing or recruiting team members?

Smava: On all fields, in the following order: legal/regulatory, recruiting and then marketing.

P2P-Banking.com: Which differences does the polish version of Smava have compared to the german Smava version?

Smava: Firstly we will start in Poland without the ‘Anleger-Pools’ (P2P-Banking: an insurance feature), because p2p loans are mostly short term there. Secondly all loan contracts will be directly between lenders and borrowers  – not like in Germany with the biw bank as intermediary.

P2P-Banking.com: What will be the maximum loan amount that can be borrowed at Smava Poland?

Smava: A polish borrower can use smava.pl for loans up to 100,000 Zloty. Each lender can invest up to a maximum of 200,000 Zloty. (P2P-Banking.com: 100,000 Zloty equal approx.  34,000 US$)

P2P-Banking.com: Which credit rating information will Smava.pl supply for the lenders?

Smava: Like in Germany smava will supply a credit score (BIK) as well as a debt/income ratio.

P2P-Banking.com: Which fee structure does Smava.pl have?

Smava: Lenders can invest fee-free, borrowers pay 1%  of the loan amount. Continue reading →

Update from Pertuity Direct

wiseclerk 1 Comment

That’s the title of an email I’ve just received from PertuityDirect.com, a Virginia based p2p lending service in pre-launch stage. Pertuity Direct announces:

… If you have been keeping tabs on the space, you know that the social lending industry has been pretty interesting over the last two to three months. The guidance that regulators have given with regard to the segment, combined with the fact that consumer loans are still hard to come by, fits perfectly with what we are bringing to market. There is a real need for alternative sources of capital for consumers, as well as new and better investing options. Social lending is a great answer to the problem – and Pertuity Direct is poised to bring it to the mass market.

We are in final preparations to launch immediately after the New Year. All of the pieces are finally in place and we are revving up for Day 1.

We’re excited about 2009 and are looking forward to reaching out to you very shortly as we open for business. …

Since the Loanio delays I am a bit wary of launch dates, but ‘immediately after’ sounds confident – looking forward to the launch in January 2009 then.

Review of peer to peer lending developments in 2008

wiseclerk 3 Comments

As the end of 2008 approaches here is a look back on the highlights of peer to peer lending news in 2008:

Noba to offer p2p lending in Hungary

Peter Petrovics 3 Comments

Guest article by Peter Petrovics, co-founder of Noba

First of all, let me thank Wiseclerk for the opportunity to post this guest piece on his blog.
I am excited to announce the January launch of the first Hungarian p2p lending service:

www.noba.hu

Also, as a regular reader of Wiseclerk’s posts, I am hoping to be able to draw on the wisdom of his readership in a particular legal problem we have run into while setting up our initiative.

My name is Peter Petrovics, and I have some modest experience working with online communities, while Charlie Szabo, my partner in Noba, is an accomplished former banker. We both have been deeply interested in the entire concept of p2p lending since we first heard of it. We  started our project in our native Hungary last summer .

We opted on a dual system: one is dedicated to the P2P lending model, where we hope to see micro projects raising money through friends, family, social network and eventually anyone interested enough in the given venture.

The other section is dedicated to channel loans to the high number of people living in deep and prolonged poverty around the country. We call these “charity” loans, and this part of noba.hu is similar to Kiva.org with the difference that it is limited to Hungary. Applicants for these loans are assisted by a mentor, who is typically an NGO or social worker, in managing their loan applications and projects.

We hope, that noba.hu will not only allow a flow of funds, but will eventually create synergies between lenders and borrowers in terms of know-how, contacts, partnerships.

Both types of loans are intended to allow lenders to make real profit, hoping on the long run to attract a larger community of private and institutional lenders.

This is however the part where we run into a very tenacious obstacle: under Hungarian law, lending (on interest) is a privilege strictly reserved to banks – private individuals are allowed to give a single loan per year, the second loan would be considered as providing commercial banking services without legal authorization. This means that the people who are willing to participate in a P2P loan project as lenders are only allowed to lend the money with a 0% interest, unless these natural persons are founding registered financial institutions.

I would be grateful for any input regarding this problem. We have made some research, and found that similar regulatory restrictions have been overcome by other initiatives in the UK, the Netherlands and Germany, but I would be interested to hear any new ideas from you.

Does anybody have any idea if the whole issue could not be approached from an EU regulatory side? Could prove to be an easier path, than pursuing separate battles against the local legal systems.

Thank you for your attention, and looking forward to your comments.

Peter

Babyloan microfinance

wiseclerk 2 Comments

Launched in summer French Babyloan.org has about 1750 lenders financing peer to peer micro-loans to entrepreneurs in developing countries. I signed up yesterday when I found the service (thanks to Jean Christophe Capelli for the pointer) and helped to fund 5 loans to borrowers in Benin, Cambodia and Tajikistan. One of them is Kheav Sitha who runs a small restaurant stand at her house in Phnom Penh, Cambodia. She wants to borrow 140 Euro for 6 months.

Signing up went smoothly. I liked the user interface for selecting the loans. It features summaries of the loan detail that are shown with AJAX on the right side of the screen while moving the mouse over photos of the borrowers seeking loans on the left side. The website is in French and English, but on some points the English translation seemed to be missing. Funds are transferred in via credit card payment – I have not yet found out how they can be transferred out after the loan term ends if they are not re-lend.

Like other platforms Babyloan partners with local microfinance institutions (MFIs). The MFIs screen the borrowers and handle the payout to the borrowers – in the case of Babyloan the payout has actually taken place BEFORE the loan is placed on the platform – and the MFI takes the sum to refinance the loan.
Unlike at MyC4 lenders do not receive interest. While Kiva asks for voluntary donations to fund its operations, at Babyloan a fee of 1 Euro per 100 Euro funded is compulsory . (Minimum a lender can lend is 20 Euro).

Babyloan is backed by Acted (a NGO), Bred (a regional bank in France) and Credit Cooperatif.

The following presentation explains what Babyloan does for MFIs:

Babyloan MFI Presentation (EN)