(last updated: December, 2019)
A year ago, I decided to give Viventor a try and deposited my first 100 EUR into my account. What drew me into the platform were the high interest rates, up to 15%, the buyback and payment guarantee policies.
At first glance, ignoring the website’s yellow theme, it just looks like a mini version of Mintos. The same primary and secondary markets, the same auto-invest, even some of the loan originators were the same. After a full year on the platform, I can still see similarities, but also lots of subtle differences.
- Launched: 2015
- Headquarters: Latvia, Riga
- Loan types: Consumer Loans, Business Loans, Invoice Financing, Mortgage-backed Loans, Line of credit, Pawnbroking Loans
- Loan terms: 1-60 months
- Loans funded: 117 million EUR
- Investors: 7200
- Interest rates: 6-15%
- Fees: no fees
- Minimum investment: 10 EUR
- Currency: EUR
- Secondary market: yes
- Auto-invest: yes
- Buyback guarantee: yes
- Accepts investors from: EU countries, or any other countries if investors have an EU bank account
How does Viventor work
Viventor is a lending marketplace that acts as an intermediary between loan originators across Europe and retail investors. It makes money by charging loan originators a small fee on top of the interest rate offered to investors.
The loan originators available on the platform are European lending companies offering all sorts of loans: consumer loans, business loans, invoice financing, lines of credit, mortgage-backed loans. The loan amounts range from a few 1000s EUR to 100.000+ EUR. The interest rates range from 6% to 16%, while the loan terms can go from a few months up to 7 years.
Investors can invest in small shares of these loans, starting with 10 EUR, in order to spread the risks across multiple investment types, loan originators and loan terms. To add an additional layer of security, loan originators offer on most of their loans a buyback guarantee, meaning the loan originators will pay investors their invested principal plus the accrued interest in case the borrowers are late with their payments by more than 30, 60 or 90 days. The buyback guarantee terms are different for each loan originator, and you can check them on Viventor’s loan originators page.
So, in case a borrower defaults, if the loan was covered by a buyback guarantee, the loan originator will pay back the accrued interest and principal to the investors. For loans not covered by a buyback guarantee, but secured by a mortgage, the loan originator will handle the funds’ recovery and then pay back the investors.
If a loan originator defaults or has problems with paying their debt, Viventor acts on behalf of their investors and handles communication with the loan originator.
In case Viventor defaults, an administrator takes over Viventor’s operations and ensures the current investments are settled.
A more in-depth look at Viventor
Viventor launched their operations in 2015 and since then, they managed to fund loans worth over 110 million EUR. Out of these loans, more than 80% have been consumer loans, 13% invoice financing and around 5% business loans. The number of loans available on the primary and secondary markets are far from Mintos’s figures, but there are always around 10.000 – 30.000 loans available on both of these markets.
There are currently around 7000 investors on the platform, and judging by Viventor’s statistics page, their average annual return is around 14%. At the end of 2018, they had around 5000 investors on the platform, so a 30% increase in numbers is not too bad. However, Viventor doesn’t disclose if these 7000 are actual investors or just dormant accounts, so numbers can be deceiving.
In 2016, they funded loans worth a bit over 13 million EUR. In 2017, 19 million EUR, in 2018, 31 million EUR and in 2019, over 50 million EUR. It seems the platform is growing at a healthy rate. The number of loan originators on the platform also increases at a steady pace. Out of the current 22 loan originators, 6 of them joined the platform in 2019.
Viventor started a partnership in 2016 with Finstar Financial Group, a Russian private investment fund focused on fintech startups. This partnership (and consequent funding) allowed Viventor to grow and expand their operations.
There’s not much information about the number of employees Viventor has but looking at their opened positions they seem to have a software development team in Barcelona, besides their office in Riga. The company’s key people are the following:
- Andrius Bolšaitis – CEO, since July 2019; he replaced Toms Niparts, who started his own lending platform, Jeff
- Raivis Palmakovskis – Head of Product Development, who also worked at Nordea and Twino
- Dainis Ābeltiņš – Investor Success Manager, which I’ve no idea what it means, but it sounds just like a fancy name for customer support
Becoming an investor
You need to have a bank account in the European Economic Area in order to register on the website and invest. The KYC process involves asking for a passport copy and a utility bill.
To fund my account, I’m using Revolut. This is mainly because my local currency is not EUR and Revolut offers the best currency conversion rates on the market. Other payment platforms like Transferwise should work too.
How safe are my investments
A year ago, the buyback guarantee on my loans was enough to make me feel safe enough to invest. As I got more experience with p2p lending, my focus started to shift a bit from the high returns to how safe is a platform to invest in and what are the risks involved.
As with any p2p lending platform, there’s a risk involved that your money will be lost. This being said, Viventor does offer some protective measures for its investors.
Viventor doesn’t disclose yet their financial statements, so it’s hard to get any warnings in case they go bankrupt. In the (currently) unlikely case Viventor defaults, an insolvency administrator will take over its operations and will ensure the settlement of outstanding investments. Since the loans offered on the platform are between investors and loan originators, your funds should still be secure.
Viventor also says they value data security and use a certified auditor service to back up their investment data on a monthly basis.
One thing missing from the platform is 2-factor authentication, so for now investor accounts are protected only by a password. Luckily, you can only withdraw funds to a verified bank account, so any potential attacker won’t be able to empty your account.
Loan originator risks
Viventor acts as an intermediary between loan originators (lending companies) and investors. The buyback guarantee on the loans is covered by the loan originators, so here is the main risk when investing with Viventor.
Viventor says it’s doing audits on all the lending companies it adds to the site, looking periodically at their financials. The only problem I’ve noticed so far was with Aforti Finance loan originator. When they stopped sending their interest payments, Viventor added a nice warning on all Aforti loans available on the primary and secondary market, warning investors about the current state and risks involved.
Some of the loan originators have attached their financial statements, but most of them don’t. Out of 22 loan originators, only 7 of them have financial statements on Viventor’s loan originators page.
Most of the loans come with a buyback guarantee but the platform also has unsecured loans. If they default, your returns will be a lot lower than expected. Even with secured loans, not all buyback guarantees are created equal. Some loan originators offer buyback guarantee after 30 days of delays, others after 90 days. While in the long term, the slight delays on the returns won’t be visible anymore, in the short-term they will affect your monthly returns.
Viventor does have a secondary market, but in some cases, you might not be able to sell your investment there. Low interest rates, Aforti loans, high buyback guarantee period, they can all lower the liquidity of your investments.
The website was built in 2015 and it feels a bit like it needs a few modern touches. While I don’t especially like their yellow theme, I started to get used to it and I don’t feel it’s that ugly anymore. The website can be used on both mobile and desktop, so there’s not too much to complain about it. The main thing that bothers me related to the website is that loading loans from the primary or secondary market takes a few seconds, and the delay is noticeable.
From a functionality standpoint, Viventor has everything needed for a crowdlending platform:
- A primary market with currently issued loans
- A secondary market where investors can sell their investments
- a decent auto-invest tool with enough settings to filter out loans you don’t want to invest in
- an account statement where you can also export your tax report
- a decent dashboard with current balance, returns, portfolio details and expected cash flows
- the ability to export your data in an excel file so you can process it outside the platform
The primary market
This is where you select the loans you want to invest in.
The secondary market
It looks similar to the primary market and has a bit more loans available here (~5000). There’s not much room for speculation on the secondary market though, it only lets you set a maximum of 1% premium on the loans you want to sell.
Anyway, it’s still a good place to exit your investment earlier.
One of the things I’m looking for in a p2p lending site is if they have or not an auto-invest tool.
Since the minimum investment amount in a loan is 10 EUR, I do want to take advantage of that and spread my investments into as many loans as possible. I want to do this in order to reduce my risks.
It would be time-consuming to do this manually, and this is where the auto-invest tool comes in handy.
The same 9 filters are available for the auto-invest profile setup. I don’t know if the auto-invest tool will pick up the best loans available on the market or not, the website is only saying it will select the first loans it finds on the primary market.
- Last update: December 2019
- Started Investing: December 11th, 2018
- Current value: 1220 EUR
- Profit: 117 EUR
- Annual return: 13.15% (computed) – Viventor tells me my annual return is 15.21%
I’ve slowly dripped funds into my Viventor account in the past year. The payments are coming regularly and Viventor keeps adding loan originators so I can diversify my portfolio.
My portfolio is relatively evenly split between consumer and business loans, so I’m happy with my distribution here.
On the other hand, I still have around 150 EUR invested in Aforti loans, because I didn’t want to sell them. This might affect my returns in the future.
A few months since I started investing with Viventor, I didn’t know if I was going to keep a foot here or not. Then I noticed some of the loan originators from Mintos or Grupeer were also present here, and many times they offered higher interest rates. It’s then when I decided I needed to stay on Viventor.
These are the main things I like about Viventor:
- Loan interest rates are good
- Buyback guarantee also includes the interest payments
- a simple and complete user interface
- the number of loans is high enough to build a well-diversified portfolio
There are also things that I’d like to change on Viventor:
- it needs a 2-factor authentication in order to protect investors accounts
- Viventor needs to be more transparent about their loan originators; financial statements should be up to date for all of them; since Viventor is performing due diligence on the loan originators, a risk rating associated with them would help
- Viventor should also make public their financial statements, as a means of being more transparent with their investors
Disclaimer: This is an affiliate link, and if you join Viventor using it, I will get a small commission. However, my review is in no way influenced by this. My main motivation for writing this was to better understand them, and I only joined Viventor’s affiliate program 6 months after I wrote about them. Before investing in any p2p lending platform, do your own research, assess the risks and your willingness to take them, and don’t forget to diversify.
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