PeerBerry P2P Lending Platform Review

Published by Daniel on

(Last Updated On: March 5, 2019)

PeerBerry is a peer to peer lending platform that had its first birthday in October 2018. They offer mostly EUR short-term loans at a usual return between 10-12%.

Lately, they added a few loan originators that also offer real estate and car leasing loans.

There are currently over 3000 investors registered on the platform (3771 at the end of 2018) and the platform is growing steady.

Key features:

  • Loan types: Short-term loans, Real-estate, Leasing
  • Interest rates: 11-13%
  • Fees: no fees
  • Minimum investment: 10 EUR
  • Currency: EUR
  • Secondary market: no
  • Auto-invest: yes
  • Buyback guarantee: yes, after 60 days, including owed interest for the delay

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My portfolio:

  • Last update: March 2019
  • Started Investing: December 17th. 2018
  • Current value: 1645.24 EUR
  • Profit: 77.08 EUR
  • Expected annual return: 11.93%

I’ve started with an initial deposit of 5000 EUR. Last month I’ve moved around 3500 EUR to other platforms.

I’ve been investing in loans with 11% to 12.6% interest rate. These are easier to find than on Mintos, and all of them have a buyback guarantee that also covers the interest owed.

Since last month I’ve stopped investing in short-term loans. They just don’t line up with my internal values. I’ve started in turn to invest in leasing and real-estate loans. These have loan terms up to 4 years and even better interest rates.

Around 30% of the short-term loans were usually late, and it did cut a bit my profits on the short term. In at most 60 days, I’ll receive interest payments for those too.

Initially, I planned to invest in these short-term loans because I could withdraw my funds fast in case a better opportunity arrived. Because these loans are usually late with their payments, I couldn’t really do this.

What is PeerBerry

PeerBerry is a p2p lending platform launched by Aventus Group at the end of October 2017. Aventus Group is a payday lender with operations in most Eastern European countries.

Aventus Group used to offer their loans on Mintos, but at some point, they decided they’re big enough to open their own platform and cash in all the profits.

PeerBerry is doing well so far, and the platform grew constantly since it started. At the end of 2018, they managed to fund loans worth more than 7 million EUR on their platform.

 

peerberry investments

Most of the loan originators on the platform are part of the Aventus Group (keeping the profits in the family).

Besides short-term loans, they started to add some new loan originators that offer car loans (from the same Aventus Group) and bridge loans secured by real estate.

Joining PeerBerry

Any person over 18 years old and living within the European Union can invest in PeerBerry.

The registration process was a bit weird because they never asked for a picture of an ID document and proof of address. These details are requested by all the other platforms I’ve used.

PeerBerry asks you for an ID only when you want to withdraw funds from your account – a scan photo of your ID or passport.

After registration, you can begin immediately to transfer money to your account. You can start to invest in any loan with as little as 10 EUR.

You can use an EU bank account, Revolut, Transferwise or any other electronic money institution if they’re based in the European Union.

invest in Mintos

Withdrawing funds from PeerBerry

Withdrawing funds from PeerBerry usually takes less than a day. I’ve been moving my funds between my Revolut account and PeerBerry and in both ways, the transfers took less than a day.

Investing in PeerBerry

You can either manually pick the loans you’re interested or create an auto-invest strategy and let it pick investments for you.  You can also use both options.

Manual Investing

pearberry loan list

On the Invest page, you get a list of available loans, with interest rates around 10-12%. Most of the loans available are short-term, although I’ve also seen a few that have more than 12 months terms.

You can also filter the available loans by interest rate, loan term, the amount available for investment, country, loan originator and if the loan has a buyback policy or not.

The buyback guaranteed policy

PeerBerry will buy back the loan for you with the full interest as well if the loan payment is more than 60 days late.

You can also sell back long term loans to PeerBerry at any time you want and they’ll offer your money back plus the accrued interest up to that point. (I don’t see a button to do that yet but that’s what their FAQ page is saying so I’ll keep looking for it)

Short-term loans don’t have this sell back at any time option.

This is a better deal than other platforms offer with a buyback guarantee. Mintos, for example, offers a similar buyback policy for loans that are 60+ days late, but you lose any interest owed for those 60 days.

Once you click on a loan you’re interested in, you get a bit more details about the borrower. The details contain their age, sex, country and how many loans the borrower already has. You can also see the loan originator details, interest rate, remaining loan term and if the loan has a buyback guarantee policy or not.

peerberry loan details

Not that these details would matter at all. You want to invest only in small shares of the loans, so you’ll only invest 10 to 50 EUR into one loan. It would be a real pain to check borrower details on every loan you invest in.

Even more, I don’t think the loan originators do too much risk assessment on their loans either. One of the loan originators, creditplus.ua, states on their website (I used google translate):

The likelihood of approval on the application is 98.2%

Anyway, let’s move on.

You can see both your current and past investments on My Investments page.

peerberry my investments

This page is consistent with the Invest page and has the same filtering options for loan amounts, loan terms, interest rates and so on.

What’s missing on the Finished Investments page is when the loan was actually paid. It only stores the value of the scheduled payment date.

You can view your account statistics on the Statement page. The page contains an account summary with deposits, withdrawals, investments and interest income. You can also view and download your list of transactions.

peerberry acount statement

The page also contains a Generate tax statement button that might come in handy when you’ll declare your taxes.

peerberry tax statements

Auto-investing in PeerBerry

peerberry autoinvest

The auto-invest feature is nice, simple and modern. It lets you set details like portfolio size, the maximum amount per investment, interest rates, loan terms, buyback guarantee. You have a reinvest check if you want to continue to reinvest your interest payments into the portfolio.

The only thing that it doesn’t let you do, and it would really help improve your returns from the platform, is setting the loan originators you’re interested in.

Most of the loans in my portfolio that are late with their payments come from 3 loan originators: CreditStar, CreditPlus and Smartpozyczka (from Russia, Ukraine and Poland).

Smartpozyczka has 60 of its 200 loans available on the platform late with their payments. That’s a loan originator I would definitely exclude from my portfolio,

Niewielkapozyczka, another loan originator from Poland, has only 9 of their 110 available loans late with their payments. Considering the alternative, I would invest a lot more in their loans than in the ones from  Smartpozyczka.

I could remove these countries from my auto-invest portfolio, but that would limit my investment options to Lithuania, Czech Republic, Denmark and Kazakhstan. Less than 10% of the loans come from these countries.

Why not invest in PeerBerry

PeerBerry offers good interest rates and a buyback guarantee that includes also the missed interest payments. And they have a decent platform to use.

These are all the good news.

30% of the loans are late with their payments

Using the auto-invest tool, you also have around 30% of your loans late with their payments. If those loans default, this would mean that for 30% of your loans you only get paid after 60 more days.

If you were planning to withdraw your funds in 30 days in case of emergency, think again. Peerberry is not really the platform to do this.

Unethical loan originators

10 out of 12 loan originators I could find info about offer loans to their clients with an APR (annual percentage rate) between 500% and 5000%.

The loans are issued for up to 45 days, so people don’t actually pay 5+ more than they received, but they still pay around 50% more.

And I don’t know the exact conditions that would lead to a 5000% annual interest rate. It depends on the borrowed sum, loan term and maybe a few other things.

The example below from pujcka7.cz, one of the loan originators, asks clients for an amazing174.000% APR on a 7 days loan. (The dog in the picture looks cute though)

high interest loan

6 of these loan originators belong to the same Aventus Group that PeerBerry is part of.

We’re in the p2p investing business for the money, but some things feel like they’re not worth it.

Conclusions on PeerBerry

PeerBerry has a few great features that make the platform one of my favourites. But it also has some missing features that might make me stop investing in their platform.

Buyback guarantee

They offer a buyback guarantee policy for loans that are over 60 days late. This also includes the interest payments for that period, so you don’t lose any money.

Auto-invest option

The auto-invest feature is good but it’s missing some important features.

It definitely needs a filter by loan originators in order to make the auto-invest actually usable.

The platform is still relatively new so I expect there will be new features added soon.

Good interest rates

The interest rates are good, ranging between 10% and 13%. They’re not the best on the market, but they’re risk-free as long as PeerBerry doesn’t go bankrupt or the entire P2P lending system crashes.

Nice user interface

The website also gets extra points for its design. It is fast and easy to use, with a clean and modern interface.

I find the loans on the platform unethical

The loan originators that offer short-term loans on PeerBerry charge their clients an APR (annual percentage rate) between 500% and 5000%.

Leaving aside the fact that investors only get an 11% rate on those loans, that APR is astronomical.

I’m sure it doesn’t help the people who need those loans and for sure it doesn’t make me feel good for taking part in this.

 


Daniel

Learning and sharing what I learn about alternative investments.

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