KPI of the Crowd4Cash platform 2017-2019

Person who wrote the post admin Apr 25, 2019
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For about two years, we have been brokering private and SME loans through our Crowdlending platform Crowd4Cash (P2P-Loans). It is time to critically review the quality of our risk selection based on metrics.

During this time, we have successfully arranged more than 160 projects. Even if one or the other interesting project could not be financed in the past. Gaining investor confidence requires time, trust and convincing numbers. We can show them and we want to share them with you:

Default rate / Defaults

For a total of 167 loan projects, only one default has so far been recorded. This is indicative of our current default rate of 0.2% across the entire loan portfolio. Combined with a targeted minimum rate of return of 4% to 5%, the default rate is extremely modest and has historically given our investors an attractive return.

Why is the default rate so low and why do we think it will continue to be so low?

Thanks to a multi-stage credit check process, which already contains several dozen data points during the application process, and our queries at the ZEK and other information databases, we can get a comprehensive picture of the borrower. We basically only open projects that convince us and in which we would invest ourselves.

Overview of the payment behavior of our borrowers

Payment P2P Loans

 

Thanks to this strict selection and thus high borrower quality, 86.5% of all payments arrived on time in the accounts of the investors. Another 7.7% could be booked within 5 days and another 4.5% within 15 days. Only 1.3% of the payments did not reach the investor until after more than 15 days. This is an absolute peak in the P2P environment and in comparison, to the general payment behavior of individuals and SMEs in Switzerland.

In Switzerland, 54% of individuals in 2018 indicated that they did not pay one or more invoices on time. 23.6% of the companies paid 14.6 days late on average.

What additional measures are we taking to avoid late payment?

The first reminder will be sent one day after the due date of the annuity. We catch many cases at an early stage or avoid further delays. We also proactively engage with borrowers at the first signs of financial difficulties and seek solutions with them. It is important for us to meet the borrowers at eye level, but nevertheless to consistently work to ensure that the claim is settled. This means a significant additional effort on a case-by-case basis, which we understand as a service to the investor.

We are convinced that both our default rates and delays in the Swiss peer-to-peer market are comparatively low and we are proud of the result achieved. We are convinced that we can continue to offer our steadily growing investor community a good return with an attractive risk profile with investments in P2P-Loans. The current key figures for our projects can be found here.