Trustbuddy AB has acquired the operations of Swedish p2p lending site Loanland effective November 19th. This means that Loanland will not close as reported earlier. Trustbuddy AB is a Swedish company with Norwegian origins. Trustbuddy will continue operations and in mid-term plans to integrate the activities of the service into their own platform. Loanland users were informed that the transfer of the membership agreements does not change anything for them.
Loanland, the only p2p lending service in Sweden, will discontinue it’s operation.
The Board of Loanland has decided to liquidate Loanland.
The reason for the decision to liquidate Loanland is that Loanland has not reached the critical mass of members needed to be a success. The company stated that today Loanland approximately has 20,000 members and requires approximately 200,000 members before becoming profitable. The Board believes that it is not realistic that Loanland reaches this volume within reasonable time.Loanland’s site will however be open until the operation is discontinued and customer service will continue as usual.
During the liquidation period, which can take up to three years, Loanland will take care of the existing loan portfolio and ensure that all loans are repaid according to the payment plans. All members’ money is at Handelsbanken in a trust account.
The company is currently providing unsecured loans to the Swedish market. The Swedish market for unsecured loans to households amount to around 160 billion SEK (around 16 billion EUR or 20 billion USD) at present and with unsecured loans to SMEs the figure is about 500 billion SEK (around 50 billion EUR or 63 billion USD). The market has grown 15% annually during the last few years.
Loanland is using an open source platform that it has developed, automating most of the processes. The technology is based on Java, J2EE, MySQL, Tomcat, Spring and Hibernate. The platform and auction engine allows individual and automatic bidding, electronic signatures, integrated credit scoring and efficient payments.
The company … has already over 10 000 members and 5 000 registered borrowers and lenders. They have 6 million SEK (600K EUR or 750K USD) deposited out of which 95 percent is lend out as loans. Quite significant number considering that the startup operates currently only in Sweden.
Loanland.se is the first Swedish p2p lending service. Founder Daniel Kaplan, who in 2006 headed the successful sale of Swedish auction site Tradera to Ebay for 48 million US$, sees a great potential for peer to peer lending in Sweden.
At Loanland, borrowers with the best credit grade can borrow up to 300,000 SEK (approx 45,000 US$), while borrowers with the lowest admitted credit grade can borrow up to 3,000 SEK (approx 450 US$). But borrowers are able to achieve a better credit rating by paying back on time and then can later borrow a larger amount, says Kaplan.
As of today the site had 4 loan listings with interest rates between 4 and 14 percent. Minimum bis seems to be 250 SEK (38 US$). Loan term seems to be customizable as 3 of the current listings are for 3 years and one is for 1 month.
Loanland is backed by experienced entrepreneurs. Aside Kaplan there are Mary Groschopp, before at OMX, Peter Nordlander, founder of Avanza, Peter Settman, founder of Baluba.