How to invest?
In order to invest on Afranga marketplace you need to add funds to your account first. You can learn more about adding funds to your account in the Deposit/Withdrawal help section. Once you’ve added funds to your account all you need to do is:
- Go to the Invest page and use our advanced filtering options or browse the entire loan book.
- Invest in all listed loans by clicking Invest in all or invest in each loan individually. You can choose the loan amount you invest in each particular loan at your will.
How do I make money from my investments?
Once you’ve invested in a particular loan, you now have the right to receive part of the payments made to this loan. The borrower of the loan makes payments according to the loan payment schedule which consist of principal, interest and late interest or a combination of the above. When the borrower makes a payment to the loan you will receive part of this payment equal to your investment share in the loan. The repaid amount will be available in your Afranga account immediately after receiving the payment. If you’ve invested in multiple loans, you will receive multiple payments according to the payment schedule of each loan.
For example, if you invest 20 EUR in a loan with a remaining principal of 160 EUR, you will own 12.5% of this loan and you will have claim rights on 12.5% of all future loan payments. Every time the borrower makes a payment you will receive 12.5% of it in your account.
What is the forecasted return?
The interest rate offered to investors will vary based on the particular loan’s risk, market and other conditions. Investors can expect to earn up to 18% per annum on their investment.
How is the interest rate calculated?
The interest rate offered to investors for a particular loan is quoted on an annual basis. The interest is calculated on a daily basis based on the amount you’ve invested in loans. The interest is calculated based on the following formula:
Interest rate / 360 x Invested amount x No. days.
Is there a minimum investment amount?
Yes, the minimum investment amount is 10 EUR for a single loan.
Can I cancel my investment?
No. Once you have invested into a loan and confirmed your decision, you will not be able to cancel the investment.
How long is the invested money locked-in?
This will depend on the term of the loan in which you have invested. You will receive your investment back in accordance with the repayment schedule of every individual loan in which you have invested.
What is a buyback guarantee and how does it work?
All loans listed on Afranga are protected by a buyback guarantee. The buyback guarantee provides extra security for your investments. What this means is that if a particular loan in which you’ve invested becomes delayed by more than 60 days, the loan originating company will repurchase the loan from you. You will receive back your initial investment plus any accrued interest.
How can I exit my investment?
Investors should be prepared to hold the investment until the maturity of the respective loan. Investors receive regular payments of principal and interest according to the payment schedule of every loan which reduce the total outstanding investment over time and will increase the size.
At the moment Afranga does not have a secondary market where you can sell your investment to another investor. However, we are working hard on introducing this feature very soon.
Afranga will consider purchasing all or part of your portfolio at a mutually agreed price. If you wish to sell your portfolio, please express your willingness by sending an email to email@example.com
How can I see the income earned from my investments?
You can see a summary of your total income in page Account Summary in your account. Alternatively, you can explore your account movements in more detail from you Account Statement page.
How safe are the investments?
It is Afranga’s top priority to design a marketplace which is as safe as possible. However, as with any investments there are some risks involved. Investors need to make an informed decision carefully weighing in all available facts and information. Afranga has taken a number of measures to mitigate the risks for the investors as much as possible:
- All loans are guaranteed by a buyback guarantee issued by the lending company. If payment on a loan you’ve invested in is delayed by more than 60 days, the lending company will repurchase the loan from you. You will receive back your initial investment plus any accrued interest.
- All loans are originated from the loan originator's own funds and the loan originator must keep a certain percentage of the loan on its books. This aligns the loan originator’s and investors’ interests. This is also known as “skin in the game”.