With up to 14% returns, consider Peer-to-Peer Lending in your investment portfolio

Alternative investments are gaining popularity due to the high returns that they potentially yield. One such alternative investment that is worth looking at is peer-to-peer(P2P) lending or commonly known as debt-based crowdfunding.

The concept is simple – small and medium business owners looking for funds to expand their businesses take up business loans which are crowdfunded by investors. The interest paid  back by the businesses is the return on investment for the investors.

Funding Societies is a licensed and approved P2P lending platform in Southeast Asia. It is the industry leader with over 30,000 investors in Singapore, Malaysia and Indonesia. As the only P2P lending platform to  win the MAS FinTech Award (SME category, 2016), Funding Societies has also won global recognition, being recognised amongst the Top 250 FinTech companies globally by CB Insights and winning the prestigious SME Global Excellence Award by United Nations’ ITU Telecom.

Here, Funding Societies explains why and how you can invest in P2P lending, a unique investment asset class that is complementary to traditional investments:

LOW BARRIERS OF ENTRY & POTENTIAL HIGH RETURNS

As an Investor, you can read the easy to understand factsheet prepared for each loan and invest only if you like the loan. The minimum investment amount is just  $100 and you can earn interest up to 14% p.a.!

If you are too busy and do not have enough time to read the factsheet then you can invest via the Auto Invest feature. Just set your parameters and let the system invest for you.

On the platform, you can invest in two types of investments:  Term Loans and Invoice Financing. The investment periods for both investments are relatively short, 1 – 12 months for Term Loans and up to 3 months for Invoice Financing.

MONTHLY REPAYMENT TO RE-INVEST EASILY

Suppose you invest into a term loan of 12 months this Christmas, you’ll receive part of your principal and interest paid back on a monthly basis until next Christmas.

Here’s an illustration:

Assuming an investor invests $100 in a loan of 10 months at 12% p.a. interest rate. The monthly repayment is calculated below.

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Therefore, the total interest earned by the investor is $10 at the end of the 10 months.

Assuming that the same investor invests 10 of such loans (10 x $100 per loan), he gets $110 in monthly repayments. The total interest earned will be $100.

Furthermore, the investor can reinvest his interest and principal multiple loans to achieve a compounding effect. Here’s another illustration:

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As shown in the above illustration, the investor re-invested his monthly repayment into new loans and was able to get $109, instead of $100 without re-investing.

LICENSED AND COMPLIANT

Funding Societies holds a Capital Markets Services license issued by the Monetary Authority of Singapore.

They have also gone through multiple  internal and  external audits to ensure that all processes are compliant.

Funding Societies is also one of the first peer-to-peer lending platforms to use an independent escrow account to handle all investor funds. What this means to you as an investor is, Funding Societies does not have direct access to your funds and the funds and investments are safeguarded by the 3rd party trustee (which is also licensed by MAS).

STRINGENT IN CREDIT RISK MANAGEMENT

The key risk in this investment is businesses defaulting on the loans. However, Funding Societies does thorough due diligence on the company to minimize this risk, which is why the default rate is also one of the lowest in the region at just 1.4% as at 30th November 2017. The returns are priced based on risk, amongst multiple factors. As an investor, you have full autonomy to choose which loans you want to invest in, based on your risk/return appetite.

Funding Societies advocates the “skin in the game” concept. The company and members of the management team invest their own money in every loan to not only co-share the returns but also risks with all the investors.

SMART FEATURES TO MAKE THINGS BETTER FOR YOU

Auto-invest feature reduces the time required to monitor opportunities. Simply input your preferred parameters and the system will do the rest.

Live chat with Miyu the chatbot on Funding Societies’ website and get your queries answered 24/7!

Even though Funding Societies is an online platform, they offer a personal, offline experience for investors. Investors can  email, call or visit their office for a no-obligation chat. Funding Societies is also a winner of the Best in Customer Experience for Alternative Financial Services this year, awarded by Retail Banker International. Try out the platform for yourself to experience it!

SIGN UP NOW TO BE AN INVESTOR WITH FUNDING SOCIETIES

Join more than 30,000 other investors on Funding Societies’ platform, and earn returns of up to 14% per annum. Make your $100 (or more) work harder for you this year and collect your ‘bonus’ next Christmas! Sign up as an investor with Funding Societies now.

Disclaimer

This article is contributed by Funding Societies.

It should not be construed that Moneydigest is endorsing this article or any of the products and services provided by Funding Societies.

Nothing in this article should be construed as constitute or form a recommendation, financial advice, or an offer, invitation or solicitation from Funding Societies to buy or subscribe for any securities and/or investment products. Any past performance, projection, forecast or simulation of results is not necessarily indicative of the future or likely performance of any company or investment. The content and materials made available are for informational purposes only and should not be relied on without obtaining the necessary independent financial or other advice in connection therewith before making an investment or other decision as may be appropriate.

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How Your Investment in Peer-to-Peer Lending Supports Local Businesses

Small and medium enterprises (SMEs) are at the heart of Singapore’s economy. They make up 99% of our enterprises, employ two-thirds of our workforce, and account for about half of Singapore’s GDP. To date, there are nearly 200,000 SMEs in Singapore.

While we often see success stories on news and social media, the road to success is sometimes not as straightforward. Find out how you can invest in peer-to-peer (P2P) lending with Funding Societies and support emerging Singapore SMEs.

Your contribution can directly make an impact on the business you’re supporting

According to a 2017 Straits Times poll, 40% of SMEs said that they thought the Singapore economy would grow in the next 12 months and 43% felt positive sales growth was on the cards.

By investing in SMEs through P2P lending, you directly contribute to immediate cashflow needs of the SMEs to grow their businesses. In return, you’re rewarded in monetary returns from the interests of the business loans. Funding Societies is one such platform in Singapore that is supporting local businesses through crowdfunding.

Read about how peer-to-peer lending works.

You earn potentially high returns on your investments while supporting local businesses

P2P lending harnesses the power of people to help local, homegrown businesses to grow and expand. Investing in P2P lending allows you to potentially earn up to 14% per annum returns on your investment.

It is actually really easy to invest in SMEs in Singapore through P2P lending. Funding Societies is a digital P2P lending platform that is dedicated to serving SMEs, therefore the mission of Funding Societies is aptly, “Stronger SMEs, Stronger Societies.” Investors receive monthly repayments which they can re-invest to support even more local businesses.

Support SMEs across multiple industries

The Ministry of Trade and Industry announced a $4.5 Billion industry transformation programme to systematically raise productivity, develop skills, drive innovation, and promote internationalisation, so as to catalyse transformation and achieve the stated vision of each industry. There’s also Infocomm Media Development Authority’s Go Digital Programme — an initiative that allows SMEs to increase productivity and capture more online sales through digitalization of their businesses.

However, the Singapore Budget 2017 recognizes that the government alone cannot help all businesses transform and the need to strengthen partnerships and collaborations in order to help SMEs succeed. Financial institutions, including alternative finance companies such as Funding Societies, play an important role in providing financial support to help SMEs grow and prosper.

As the minimum investment for peer-to-peer lending starts as low as $100 on the Funding Societies platform, you could help the economy holistically by investing in multiple industries and companies at the same time, in turn diversifying your investment portfolio across sectors.

Since its inception in 2015, Funding Societies has already expanded to two more Southeast Asian countries over the last two years – Indonesia and Malaysia. It is the only P2P lending platform to have won the Monetary Authority of Singapore (MAS) Fintech Award in 2016 and was recognised as one of the Top 250 Fintech companies globally.

More than 23,000 investors are already on Funding Societies’ platform regionally. Find out how to invest on the platform here.

Interested? Sign up for your investor account with Funding Societies now.

Disclaimer

This article is contributed by Funding Societies.

It should not be construed that Moneydigest is endorsing this article or any of the products and services provided by Funding Societies.

Nothing in this article should be construed as constitute or form a recommendation, financial advice, or an offer, invitation or solicitation from Funding Societies to buy or subscribe for any securities and/or investment products. The content and materials made available are for informational purposes only and should not be relied on without obtaining the necessary independent financial or other advice in connection therewith before making an investment or other decision as may be appropriate.

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How to start your peer-to-peer lending investment journey with Funding Societies

In September, we gave you 5 reasons to invest in peer-to-peer (P2P) lending. If you have not already opened your account on Funding Societies’ investor platform, it’s time to start now and earn up to 14% per annum returns on your investments along with 21,000 other investors who invest in crowdfunding with Funding Societies.

Here’s a recap of how P2P lending works

What are the products?

With Funding Societies, you can invest into the following 2 products:

Business Term Loans – Loan given to SMEs for working capital, fulfilment of contracts, acquiring new contracts etc. with tenors ranging from 1 month to 12 months. As an investor, you receive principal and interest on a monthly basis thus unlocking the cash and allowing you to reinvest the monies into new loans.

Invoice Financing (Accounts Receivables Purchase) – Funding provided to SMEs against the invoices issued to their buyers/debtors/clients with tenors ranging from 30 days to 90 days depending on the invoice credit period terms. Investors receive repayment at the end of 30/60/90 days along with interest.

Every deal could have a few hundred investors investing alongside you and thus you fund a small part of each loan/invoice and therefore also bear the same small part of the risk.

Okay, how do I start?

  1. Sign up as an investor on Funding Societies platform
  2. Receive your subscription agreement and e-sign it! (Fun fact: Funding Societies is the first P2P lending platform that has e-signing of contract so that their investors can do it on their computer or mobile anytime, anywhere)
  3. Make your first deposit of minimum $1,000
  4. Browse for opportunities on web or app platform
  5. Start investing from as little as $100
  6. Turn on Auto-Invest to let the system allocate investments based on your pre-set criteria

How do I choose which investments to go for?

Before every crowdfunding opportunity, you’ll receive an email alert for the deal. There is a detailed fact sheet that you can review hours before deciding to put your money in the loan.

Some of the investors on Funding Societies platform have placed their monies on every loan by either (i) manually investing when the crowdfunding period starts, or (ii) auto-investing (see point #6 above). For every auto-invested loan, you always have a choice to opt out from the investment before the crowdfunding starts.

However, different investors have different risk appetite, so it is common practice, and also a good one, to explore the platform and view the various opportunities before making your investment decision.

How do I track the repayments and performance of the investments?

When you invest on Funding Societies platform, the repayments are on a monthly basis.

Simply log on to the web portal and access the dashboard. Check out the screenshots here.

As an investor, you will also receive late repayment fees from SMEs who did not make the repayment on time – but hey, when you share the risk, it’s only fair that you share the returns right?

Common strategies to invest in P2P lending

While there is no one-size-fits-all formula for any type of investment, Funding Societies shares three ways you can explore for your investment portfolio with them:

  1. Diversify, Diversify, Diversify

As a matter of fact, investing in P2P lending is already one way to diversify your investment portfolio. However, within P2P lending, it makes sense to diversify your portfolio into different loans – by industries, amounts, tenure – to minimize the default risk.

  1. Create compounding effect by re-investing

Funding Societies’ repayment schedule is on a monthly basis, that means you get your original invested amount + pro-rated interests back every month based on the stated dates. While you can hold the money in the account, a smart thing to do is to use this for other investments on the platform to create a compounding effect.

  1. Free your time with Auto-Invest

As mentioned, Auto-Invest is a feature Funding Societies created to allow their investors to put in their money for loans based on their preferred criteria. Here, you can choose a range of interest rates, tenure, industries. Once it’s set up and switched on, the algorithm sets in to auto-allocate your preferred amount for the loans that fall within your criteria.

Start exploring P2P lending as an alternative investment now with Funding Societies. Sign up now by clicking here.

 

Disclaimers

This article is contributed by Funding Societies.

It should not be construed that Moneydigest is endorsing this article or any of the products and services provided by Funding Societies.

Nothing in this article should be construed as constitute or form a recommendation, financial advice, or an offer, invitation or solicitation from Funding Societies to buy or subscribe for any securities and/or investment products. The content and materials made available are for informational purposes only and should not be relied on without obtaining the necessary independent financial or other advice in connection therewith before making an investment or other decision as may be appropriate.

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5 Reasons to Invest in P2P Lending Now

P2P lending, popularly known as crowdfunding, provides individuals and institutions an opportunity to earn passive income through investing in business loans to growing and deserving SMEs. Returns on investment are in the form of repayment of periodic interest along with the principal, based on the amount that investors have put in. In a single loan, there could be hundreds of investors who co-invest and share the risks and returns of investment.

This concept first appeared in 2005 with Zopa  (founded in the UK), and has become a proven investment product globally. In 2016, more than US$330 Billion has been invested in P2P lending with China, US and UK as market leaders.

Can you guess where’s the next region of growth for P2P lending? That’s right – Southeast Asia. Funding Societies (based in Singapore, Indonesia and Malaysia) is one of the leading platforms in this region with licenses/approval by regulators in all 3 markets.

Here, we give you 5 compelling reasons to put your money into P2P lending :

1. Returns are higher than most traditional investment products

One of the key factors in any investment is what you get in return.

In Singapore, investing in P2P lending can potentially earn you up to 14% per annum returns on your investment. This is much higher than 1%-2% per annum on Fixed Deposits or 2.5% per annum on your CPF account.

2. And you don’t need to wait for years to see your returns

The typical tenure for these business loans range between 1-12 months, so unlike fixed deposits or insurances, you don’t need to lock your money in for years to see the returns. In addition, you get the interest as well as principal back on a monthly basis, allowing you to unlock the cash and provide opportunities to reinvest the money and creating a compounding effect.

3. You can invest even if you’re a fresh grad or NS man

Funding Societies is the only platform that allows investments starting from as low as $100 (minimal investment on other platforms is usually $1,000 per loan), which means literally anyone can invest. It allows one to test the platform before increasing the amounts and also provides opportunities to diversify into multiple loans even with a small starting capital.

4. It’s a simple product that doesn’t require any technical knowledge

Some investment products require a high level of technical knowledge plus a close watch on the market movements.

P2P lending is simple and straightforward. It’s easy to understand the factsheet (prepared by the platform) which covers the SME’s business model, track record, financials and purpose of loan. Investors can make decisions based on the factsheet. If you are too busy to review every factsheet, Funding Societies has an auto investment feature which lets you select your investment criteria and make the investments automatically.

5. Southeast Asia’s leading P2P platform is in Singapore

Most Singaporeans prefer to invest with companies with (i) a solid track record, (ii) operations in Singapore.

Since starting its operations in Singapore, Funding Societies has already expanded to two more Southeast Asian countries over the last two years – Indonesia and Malaysia. It is the only P2P lending platform to have won Monetary Authority of Singapore (MAS) Fintech Award in 2016 and was recognised as one of the Top 250 Fintech companies globally. It is backed by world class venture capitalist Sequoia Capital who have invested into companies like Google, Apple, Airbnb and Carousell amongst many others.

More than 19,000 investors are already on Funding Societies’ platform regionally, and the reasons:

  • LICENSED AND REGULATED: Funding Societies is licensed in Singapore by MAS and is a regulated entity. It uses escrow account for investor funds managed by a licensed trustee ensuring safety of investor monies.
  • HIGH QUALITY INVESTMENTS: Because of the rigorous risk assessment that Funding Societies does on the companies before offering the business loans for crowdfunding, the investments are good quality and at the lowest default rates in town.
  • EASY TO INVEST: Investors can make their investments and review their portfolio on the go with Funding Societies investor mobile app. With Auto-Invest, investors just need to define their preferred parameters and let the system do the work.
  • SKIN IN THE GAME: The top management at Funding Societies believes in ALL the business loans that they give, they invest in every single loan. As CEO Kelvin Teo says, “We co-share the risks and rewards of investments with you.”

Sign up for your investor account with Funding Societies now.

Disclaimers

This article is contributed by Funding Societies.

It should not be construed that Moneydigest is endorsing this article or any of the products and services provided by Funding Societies.

Nothing in this article should be construed as constitute or form a recommendation, financial advice, or an offer, invitation or solicitation from Funding Societies to buy or subscribe for any securities and/or investment products. The content and materials made available are for informational purposes only and should not be relied on without obtaining the necessary independent financial or other advice in connection therewith before making an investment or other decision as may be appropriate.

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Why You Should Invest into P2P Lending in 2017

Is expanding your investment portfolio one of your 2017 New Year’s resolutions? Unsure about which opportunity is best? Then P2P lending might be the right investment for you! Hailed by asset managers and investment experts as a new asset class with attractive returns, P2P lending is slowing catching on and moving mainstream. In 2015, P2P lenders originated loans worth $64 billion through a mix of retail and institutional investors. Market researchers expect the industry to grow at a cumulative annual growth rate (CAGR) of 53.06%. For an investor, there are many reasons to invest in this asset class, besides the segment’s potential.

  1. Short Learning Curve and Requires Little Expertise

Compared to other forms of investments such as stocks or bonds, P2P Lending has a very short learning curve. It is considerably simpler to grasp – the platform would have already done most of the assessment for you. Funding Societies is one such P2P business lending platform. Winner of the MAS Fintech 2016 award, they have a presence across Singapore, Indonesia, and Malaysia. Not only do they perform detailed due diligence and credit assessments on all prospective borrowing companies, they also undertake collections if there are delays in payment by the borrowers. Only deserving companies are approved for loans. A factsheet detailing important information about each borrower and its directors is prepared for the investors and put up to facilitate an informed investing decision.

  1. Low Investment Commitment

You don’t need to set aside large amounts to invest into P2P loans. Usually, the minimum investment is about $1000. At Funding Societies, it’s even lower – just S$100 per loan. This provides investors an opportunity to test out the concept and the platform before committing a larger quantum. Investors also have the flexibility to invest in shorter time horizons, with tenors ranging from 1 to 12 months. Compared to investments which require a longer lock-in period, P2P lending provides a shorter and more liquid investment option.

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  1. Opportunities to Diversify

You may perhaps already have investments in properties, stocks, bonds etc. P2P lending provides yet another avenue to diversify. Not only is P2P lending an alternate asset class, it also provides opportunities to invest into loans in different industries, which minimises risk exposure to any particular industry. The low minimum investment ensures that every investor irrespective of their income can ensure diversification by investing into multiple loans.

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  1. Attractive Returns

With returns more attractive compared to traditional investments, the appeal of P2P lending is obvious. At Funding Societies, investment returns could be as high as 14% per annum. Additionally, compared to most investment products, the risk is lower given the opportunities for diversification, shorter tenors, and easy-to-grasp concept.

  1. Periodic Returns

Unlike most investment products, P2P investments are fairly liquid with returns (principal & interest) paid back on a periodic basis (usually every month). Funding Societies credits its investor accounts with repayments on a monthly basis with the option for investors to either withdraw or even re-invest, creating a compounding effect.

The World Bank has projected a 2.7% global growth rate for 2017, along with a lower growth rate of 1.8% for developed economies and predicted heightened uncertainty. Add to the fact that stock markets have been volatile and most categories of investments are offering relatively low returns, now is the right time to invest into a shorter-term and more liquid asset class with reasonable returns that ensures wealth creation even in gloomy times. Is P2P lending the right asset class for current times given the short investment horizon, relatively liquid option, low investment requirement, and attractive returns? Seems right.

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Funding Societies is a Singapore-based P2P lending platform with a regional presence. It’s founded by Harvard and Stanford graduates, with collective management experience from banks, FIs, tech firms and startups. It’s funded by prominent Silicon Valley venture capital firm Sequoia Capital, who are early investors of Apple, Google and AirBnB amongst many others  It is one of the first to receive licenses and recognition across countries in Singapore, Indonesia, and Malaysia. To start investing in P2P lending, just visit www.fundingsocieties.com.

Disclaimers

This article is contributed by Funding Societies.

It should not be construed that Moneydigest is endorsing this article or any of the products and services provided by Funding Societies.

Nothing in this article should be construed as constitute or form a recommendation, financial advice, or an offer, invitation or solicitation from Funding Societies to buy or subscribe for any securities and/or investment products. The content and materials made available are for informational purposes only and should not be relied on without obtaining the necessary independent financial or other advice in connection therewith before making an investment or other decision as may be appropriate.

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