Flender is a p2p lending platform that offers loans for Irish small and medium enterprises.

Since they started in 2015, they’ve raised more than 9 million EUR in loans and generated for their 6000+ investors an average return of 10.4%.

The loan amounts range from 15.000 EUR to 150.000 EUR and the loan terms are up to 3 years.

Key features:

  • Loan types: Business loans
  • Loan terms: up to 3 years
  • Interest rates: 9.1% to 15.9%
  • Fees: no fees
  • Minimum investment: 50 EUR
  • Currency: EUR
  • Secondary market: no
  • Auto-invest: yes
  • Buyback guarantee: no
  • Bonus: 5% bonus on all investments made in the first 30 days (with the link below)

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Investing in Flender loans

You’ll need to put at least 50 EUR in any project you invest in. There is no upper limit on how much you can invest in a loan.

Each loan is rated with a credit ranking from A+ to V. Flender analyses the borrowers’ creditworthiness in-house and also uses the credit information obtained from Credit Safe and Stubbs Gazette.

flender credit ratings

Based on the credit rating, for each loan, an interest rate is given. And this is where it gets interesting.

Even though it says that for a B rated credit the lender interest rate is 10.5%, it’s not completely true. You receive interest payments each month along with a part of the principal invested. 10.5% is the expected return if you reinvest all the interest payments on new loans as soon as they’re paid to you.

Let me explain better.

One of the loans I’ve invested has an interest rate of 10.5% and its loan term is 36 months. I’ve invested 50 EUR and I’m expected to receive a total of 8.51 EUR in interest during the 3 years period. The 8.51 EUR is only 17% return on my initial 50 EUR investment. That’s just a 5.7% return per year, which is a lot lower than the advertised 10.5%.

Flender is saying that I should reach a 10.5% annual return if I reinvest the monthly repayments into new loans. Because along with the interest payments I also receive each month a part of the investment principal, that is feasible.

Nevertheless, the advertised interest rates are a bit confusing, to say the least.

For the 10.5% loan described earlier, I receive each month 1.61 EUR in interest + principal. Since the minimum investment in a loan is 50 EUR, I won’t be able to reinvest that payment into a new loan, unless I’ve invested either a larger sum or into more loans. To reach the minimum 50 EUR in payments each month, I’ll need to invest in Flender at least 1500 EUR, which is not that large. I just need to keep in mind that’s the minimum sum I need to invest in order to get the advertised returns.

Currently, I’ve only invested 150 EUR in 3 different loans, but I’ll add more as soon as more loans are available.

Why invest in Flender

Even though their advertised interest rates are a bit distorted, investing in this platform still offers an average return of more than 10% per year.

The loans don’t come with a buyback guarantee, but the default rate so far is less than 0.2%. With a bit of diversification, spreading my funds into multiple loans, the investments here are pretty safe.

Most of the business lending platforms I’m invested in are based in the Baltic countries (Envestio, Crowdestor, TFG Crowd, Kuetzal, Grupeer, Crowdestate). Investing in Irish business loans provides diversification for my portfolio.

I can use the auto-invest tool, weirdly named AutoFlend, and let my portfolio run on autopilot. I only need to set up the credit ratings I’m interested in, the loan terms and the maximum amount to invest.

There are no fees for investing on the platform. This should be the norm on all p2p lending platforms, but you do find every once in a while the odd one that asks for a small percentage before they let you give them your money.

Flender doesn’t tax your income so you can handle your tax returns by yourself in your home country.

Why not invest in Flender

The loans don’t come with a buyback guarantee. There are other platforms out there that do offer a buyback, and this makes it a bit easier to invest in (Envestio, TFG Crowd, Grupeer, Kuetzal).

There’s no secondary market, so it’s impossible to withdraw from your investments before the loan matures.

The returns are decent, 10%+ returns are good enough, but they don’t come close to the 13-21% returns advertised on the Baltics p2p lending platforms.

And I also find really confusing and a bit misleading their advertised interest rates. At least they could do is to change the naming into lender return or something similar.

You can only withdraw money from your account once a month (in any day of the month). I think they do this in order to minimize the fees they pay to the payment processor. It’s still a bit odd.

Who can join Flender

Flender is open to investors from all over the world. You’ll need an ID and proof of address to pass the verification process, and the process is very smooth.

Summary on Flender

Flender is a mature crowdlending platform offering decent returns for its investors. The low default rates suffered so far makes up a bit for the lack of buyback guarantee.

It does lack a secondary market or a way to exit my investment early, but I do plan to invest long-term, so it doesn’t really bother me yet.

I don’t like their misleading “interest rate” concept. Their advertised interest rate is more of an expected annual return, in lack of a better term.

All things considered, it’s a good platform for diversifying my portfolio.

If you wish to join Flender, you can use my referral link and receive a 5% bonus for any investments you make in the first 30 days.

If you found my review useful, you can also check out my other reviews on similar platforms: Envestio, Kuetzal, TFG Crowd, Crowdestor or Grupeer.

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6 Comments

Hrlena · September 24, 2019 at 10:52 pm

Thanks for the article on Flender.

Just a few bits you can add in. As a lender you are not covered by any regulation with Flender as there is none in Ireland for PTP

Flender do not have very minimal t&c no complaints procedure or clear process. There have been loans where they have not advised that given company has more than 1 loan or included these figures in the financials and then issue no recourse due to there error : Company X already had 3 loans for 2018 was not advised with loan number 4 in 2018 and not included in the financial snapshot. Worst still loan went straight into being paid back using deposit which was not advised until borrower stopped paying after deposit ran out. Financials on all loans are not accurate as do not include depreciation figure for ebita.

All above raised with Flender not just by me but a number of people and they offer no recourse or goodwill due to their error and have yet to provide depreciation figure or clear and complete t&c .

All I’m saying is I am personally now a bit wary of investing further funds and I use Linked Finance more who’s figures, t&c processes and procedures are more accurate and user friendly even though they charge a fee I think for the extra bit of attention to detail and clearness of financials is worth it.

    Daniel · September 25, 2019 at 3:06 pm

    Hi, thanks for your comment. This is interesting. I’ll do a bit of digging and ask Flender what they think about it.

Hrlena · October 7, 2019 at 1:37 am

Don’t want Flender to defame me on your site like they have on other sites about my review. so please remove my review on the 24.09.2019 as I don’t want hassle for you. I can prove my review is fair but it’s just really stressed me out.

    Daniel · October 15, 2019 at 9:37 am

    Don’t worry, I review the comments before I approve them.

Andi · November 21, 2019 at 11:26 pm

Hi Daniel, I agree with Hrlena – been having issues with their support for a couple of days now – in fact, I got so frustrated, I set up a blog and wrote a review – would be interesting to know if other people have the same issue regarding their creative approach on calculating the account balance.

    Daniel · November 22, 2019 at 4:19 am

    Hi Andi,
    Interesting article you have there. I track my investments monthly – I’ll keep an eye and see if my account value doesn’t add up. So far, nothing suspicious in my account.

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