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Who is Grupeer?
Grupeer is a Latvian crowdlending platform that is growing rapidly. Their office is located in Riga, and they have been in business since late 2016. Grupeer has a variety of loan types. Mortgage loans, business loans, and development projects. They all come with buyback guarantee. Even the development projects! This is not that common for this type of project. Loans and projects yield between 10 % and 14 % per year and loan term is anywhere up to 36 months.
The website is available in five languages and has a good FAQ section to help you out. I have to say that I really like Grupeer. Their interest rates are a bit higher than many of the other platforms in its category and there is very little cash drag. Usually my funds are invested in hours after being deposited. If you are a lazy investor that just want to be set up quickly and have good returns, while doing as little maintenance as possible, then Grupeer is the platform for you.
Signing up with Grupeer as an investor is easy and free. Just click the “Register” link on the top right side of the website and you will be taken to a form where you fill in some basic contact information. Ones you hit the “Register” button, you will be ready to go.
The next thing you need to do is to provide picture and address id due to the AML laws. For picture id, you will be best off using your passport. Passport is king when it comes to picture id. You will need to upload a picture of the full cover as well as the full open picture page. Anything else than a passport may put you in a waiting position at support and that is just annoying and could drag on for days.
You also need to supply address id. I usually go to my direct debit section of my netbank and pull a PDF of any utility bill with my name and address on it. If you receive yours by mail, just take a picture of it and upload it. After you have uploaded your documentation it will take about a day for Grupeer to approve your documents. In the meantime you can transfer money to your account for investing.
Transferring money to invest.
Now you need to add the funds to your account. Click the “Deposit/Withdraw” in the top menu and choose “Add Funds”. Under “Bank payment” you can see the two banks. It doesn’t matter which one you transfer to. You can do a SEPA transfer to your account if this is your first time investing. You will pay a small fee for the transfer. But at least then you are off and can get started. You can do a SEPA transfer in your netbank. You will need to use the Bank Account Number also called IBAN and the SWIFT or BIC code. Do not forget to add your payment detail including your Grupeer ID for your investor account in the comment for the transfer, so that Grupeer will know what account to deposit the funds to. The money should arrive on your investment account in a few business days.
Grupeer has also added functionality to use Transferwise, which is a great online service for transferring money abroad. It usually is cheaper than a SEPA transfer. I actually made a deal with Transferwise to give you your first transfer of up to about 580 euros (500 £) for free – try it out! Another transfer method I really recommend you use is Revolut, as you will get the transfer and currency exchange for free with this service for up to 5300 euros per month! I only used a SEPA transfer on the first few transfers when I started investing because it was something I had done before and was comfortable with. Now I only use Transferwise and Revolut. They are both cheaper options. When your money arrive at your investment account, you are ready to invest! If you do not see the option to use Transferwise it is because Grupeer will disable this options for a period of time, until Transferwise include more information with the transfer. You can read more about why that is in my interview with Grupeer.
There are solid diversification options with a good amount of loan originators and the number keeps growing. Like on some other platforms, Grupeer demands that loan providers keep at least 5 % skin in the game. This means that a loan provider needs to have 5 % of the loan and will therefore always take a hit if there is a default. This helps ensure that loan originators do proper credit scoring and bring in quality loans and projects for Grupeer investors.
Types of projects.
Here are some examples of development projects. As you can see not all of Grupeers development projects are in the Baltic states. Far from it. Recently there have been more projects in Norway and Sweden. Being Danish in some way that makes me feel more secure in my gut. How everything works in Scandinavia is more well-known to me. I included pictures below of some residential projects in Norway and Sweden and a hotel development project in Minsk, Belarus. Every investment opportunity has a detailed description about the loan, project, financials, payback schedule and more. Besides development projects, Grupeer also have mortgage loans and business loans.
Buyback and cashback.
The buyback guarantee is available for all loans and project and for most loan providers the buyback happens after 60 days of the loan being non-current. For some loan providers however, it happens earlier, some even after just two weeks. Interests will still be earned when the loan is non-current and paid out when the buyback kicks in.
All loans with buyback is clearly marked with a green shield icon in the loan list. If the loan offers cashback you will see a blue euro icon on top of the buyback icon. The cashback is usually 1-2 % and will be paid out shortly after you invest in the loan.
Simple auto invest or manual investing.
You can both do manual investing where you hand pick every single investment or you can make everything automatic, with the simple and easy to use auto invest functionality. What you choose is up to you, depending on how many money you are investing and how much you want to manage your portfolio on a day to day basis.
You can do with manual investing if you prefer. You just set the criterias for the loans you are searching for for example interest rate and hit the “Filter” button. The list will now only contain the loan matching you filters. If the loan or project has a blue invest button on the right side, you can still invest in the project. Clicking the button will reveal a text field where you enter the amount you want to invest. Ones you click the suitcase button next to the amount and you will be taken to the confirmation page. Here you need to click the “Invest” button to finalize your investment.
Auto invest – easy, simple, yet powerful.
One of my favorite things about Grupeer is their auto invest. It is really quick and simple to set up and it has the options for tweaking the parameters most investors want. You can select loans by Loan Type, Country, Loan Originator, Interest Rate Level and Loan Term. You can set an upper limit in euros to your auto invest strategy. If you instead do not want an upper limit, you just check the “Strategy Auto-invest unlimited” and the field will be set to “0” and locked. You must set the max amount invested per loan. I always put 10 euros as it is the minimum. That gives me better diversification, as my money will be spread out on as many loans as possible.
Another awesome option that Grupeer added, is the ability to choose if you want amortizing or non-amortizing loans. Amortizing loans are really good for the more careful investor.
Under the slider for the interest rate level is an “Including CashBack” check box. If you check this box, then cashback bonuses can be counted as interests. Sometimes loan providers give a cashback when you invest in a loan with them. Cashback campaigns are common when new loan providers are introduced on the platform. The “Including CashBack option favours cashback loans. Here is an example: You have your auto invest strategy set to minimum 13 % including cashback. You only have 10 euros available at the moment for investing. Two loans become available at the same time. One has a 14 % interest rate and the other has a 12 % and a 2 % cashback.
The auto invest will now choose the cashback loan, as 12 % + 2 % = 14 %, so both loans match your auto invest strategy. I have chosen to include cashback in my own auto invest strategies, as the cashback is paid out right after the investment is made. That cashback can then be reinvested immediately and start earning interest right away.
You can set up several auto invest strategies and put them into priority. You can easily switch the different strategies on and off. If you click the “Invest in old” button, you allow the auto invest on that strategy to invest just one time in available loans you are already invested in. This will happen every time you click the button. This is actually a really useful functionality to quickly get rid of a little cash drag on your account.
Ones you get invested, you could be payed 1-2 % right away if you invest in a loan or project with cashback.
If not the first interest payment should start to roll in after a couple of days to a week. You can see all the transactions coming in and going out by using the button “Account Statement” from the dashboard/overview.
The positive transactions could be a principal repayment, interest payment, cashback bonus. A negative number, marked with a red color, means you made a new investment.
Secondary market? What if I need my invested money back?
One downside to Grupeer is the absence of a secondary market. So if you need to liquidate your funds you need to stop reinvesting and wait for all the loans to mature. That could be up to 3 years, depending on the loans you currently hold in your portfolio. There is a page stating that a secondary market will be introduced later, but that page has not changed since I started investing with Grupeer, so I do not expect it to be available anytime soon. Any available funds on your investment account can be transferred back to the account they came from, under the menu “Deposit/Withdraw”.
What if Grupeer goes bankrupt?
The Grupeer platform is an asset of the Grupeer company. In case the company bankrupts, investors can claim directly from the loan originator as the loan originator still has liabilities towards all investors who made investments in loan originator projects. All relationship is between investor and loan originator. All the processes in regard to the bankruptcy will be governed by the legislation of the Republic of Latvia and a bankruptcy administrator will be appointed to e.g. manage payments.
What if a loan originator goes bankrupt?
In the case when a loan originator goes bankrupt, the borrowers is informed about the change of his creditors, and the investor has direct claim rights towards borrower. In most cases, a bankruptcy administrator will be appointed who will manage e.g. payments.
Reporting for your taxes and statistics.
It is possible to get a simple list of transactions in a certain time span. They can be viewed on the website, but also downloaded as an Excel file. This is very helpful when you need to do your taxes at the end of the year, or just do a quick status of your finances.
However, It is very basic reporting information. It basically can be used for little more than getting the numbers for doing your taxes. I would really like to have had a proper statistics with graphical overview of how you are split up over e.g. loan provider and loan types. It would be nice to have a quick overview on how well diversified you really are on the platform.
Communication from Grupeer.
Grupeer will send you information about the activity on you account. First of all, you will get an email with a registration confirmation and another one when you have uploaded your documentation and they have been approved. From there you will receive emails when certain events occur. When money you have transferred to Grupeer arrives in your investment account, you will be notified via email. The same goes for when some of your principal is paid back or you have received interest payments.
I really like the last mail about profits that arrives frequently with the subject “Payment have been made to your account”. It makes me feel like have won the lottery a little bit each time! Periodically Grupeer will also send you a balance report that tells you your current account balance and your current invested amount. I really like that these emails give me the account balance on a regular basis. It means that you can keep an eye on if there is any cash drag, without actually logging into your dashboard.
Downsides to the Grupeer platform.
The biggest downside to Grupeer is the absence of a diversification tool in the auto invest to secure diversification over loan providers. It is not easy to see if you actually are well diversified neither in the reporting or under “My investments”. The absence of a secondary market is also a minus. However I have not had the need of a secondary market yet, but it would be a very good option to have.
All in all, I truly enjoy using Grupeer. There are plenty of loans and projects, simple but powerful auto invest with prioritisation, simple interface, good interest rates, buyback, cashback, and a decent amount of loan providers to get you diversified. I also very much like that there are quite a few project in e.g. Sweden and Norway and not in only the Baltic states. Grupeer is a great beginner platform or a very good addition, if your portfolio contains several crowdlending platforms.
A short time ago, I sat down with my mom and we got her setup on Mintos and Grupeer. She had heard me talk about crowdlending and wanted to get started herself as well. We went through everything on the platform and set up a solid auto invest strategy on both platforms. A short time after my dad wanted me to help him do the same. Now they both have a small crowdlending portfolio. Grupeer is a great beginner platform that I recommend to anyone who want to get into crowdlending or want to expand their portfolio with yet another platform.
Sign-up at Grupeer today!
If you sign-up today, you can be all set up today and start earning from tomorrow. If you have any troubles or concerns signing up, please leave a comment below.