How do you select the best loan originators when investing in Mintos? I asked myself the same question, so I made a list for you to help you select the loan originators to invest in.
Last update: September 2, 2019
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What did I look at?
Since I started investing on Mintos, I have been reading a lot about the platform and tried to figure out what the best investment strategy is. Which loan originators do I have to avoid and which ones are good and solid?
To answer this question, I looked at a couple of different things:
- The ratings of Mintos loan originators from ExploreP2P
- The ratings of Mintos loan originators from Mintos itself
- Does the loan originator offer a buyback guarantee on it’s loans
- Does the loan originator pay interest on late loans
- Loan originators with a grace period of max 10 days
- The statistics on Mintos, how many % of the loans is paid on time (current)?
Explore P2P ratings
ExploreP2P has rated all Mintos loan originators according to different things, like their financial reports. To me, it looks like a solid rating, that’s why I use it to decide in which loan originators I would like to invest in.
I decided to go for the loan originators with a score of 50 and above, which gives us a list of 29 loan originators. (It’s 30 actually, but I excluded 1pm, as they dont have EUR loans, only GBP).
Mintos has 10 different ratings, from A+ to D. Since I don’t like to invest in loan originators with too much risk, I only include loan originators with a low to moderate risk. (Explanation about the Mintos ratings can be found here).
None of the current 28 loan originators have a C or D rating, so we are still at 29 loan originators.
I don’t invest in loans without a buyback guarantee.
The risk is a bit lower with this guarantee, as all loans that are 60 days late, will be bought back by the loan originator and I will get my money plus accrued interest instead of losing my money.
Of course it doesn’t make investing risk-free as the loan originator or the platform itself can still default and the buyback guarantee won’t be worth much at that point.
All of the 29 loan originators on the list offer buyback guarantee on some or all of their loans.
Interest Income on Delayed Payments
Since I want to receive interest on my late loans, I exclude loan originators that don’t pay interest income on delayed payments (IIDP in short):
- EBV Finance
- Cream Finance (only Latvia)
- Watu Credit
EBV’s loan are always 100% paid on time, that’s why I will keep EBV on the list.
Credit to P2P Millionare for telling me about EBV. He said: “It is because EBV collects VAT rebates from governments and governments tend to be reliable payers.” I didn’t know that yet. So, EBV will remain on the list.
Cream Finance will also remain on the list as their loans from other counties than Latvia do offer IIDP.
Mogo and Acema do have a penalty income on delayed payments, which also covers some of the interest on late loans. In the end it’s up to you if you want to invest in them or not. I excluded them on my list for now.
This means that 4 out of these 6 will go off the list and we’re down to 25 loan originators.
The grace period
Since the grace period doesn’t count as being late, you don’t get any interest over this period (unless a loan goes from grace period to late, then all days do count as late).
I don’t want to invest in loan originators that have a grace period of more than 10 days. On this list only Dozarplati has a grace period of more than 10 days (15 days).
This means we are down to 24 loan originators.
The statistics from Mintos show what percentage of each loan originator’s outstanding loans are paid on time (current). I think this is an important score, because if a lot of the payments are late, something might be wrong.
Does the loan originator perform a good background check on his client to make sure the client can actually pay the loan back? Can the loan originator keep up with the buyback guarantee if a high percentage of the loans are paid late or never paid at all?
Mogo, Kredit Pintar and LF Tech have 0% loans that are paid on time from their short-term loans. For LF Tech this includes all of their loans on Mintos, so I’m going to exclude them on the list.
Combining everything, we have 23 loan originators left. These are the loan originators I feel comfortable with investing in. To give you an overview, I added all of the loan originators with an ExploreP2P rating of at least 50 in a table and added the other variables I looked at.
The red loan originators are off my list due to one or more of my criteria. In the end it’s up to you of course which loan originators you want to invest in.
|Credit Star||79||B||Yes||Yes||0 - 3||79.4 %
|ID Finance||78||B+/B-||Yes||Yes||0 - 3||87.5 %
|Banknote||77||A-||Yes & No||Yes||3||81.7 %
|Iute Credit||77||B+||Yes||Yes||7||76.9 %
|Mogo||76||A||Yes & No||No||0 - 4||67.7 %
|Placet Group||71||A-/B+||Yes||Yes||0 - 2||76.5 %|
Rest: 0 - 3
|Kredit Pintar||66||B+||Yes||Yes||0||84.4 %
|LF Tech||66||B-||Yes||Yes||0||0 %|
|Lime Zaim||65||B||Yes||Yes||0||99.5 %
|Acema||61||A-||Yes & No||No||3||84.6 %|
|Watu Credit||61||B||Yes||No||0||70.1 %|
|EBV Finance||58||A-||Yes||No||0||100 %|
|BB Finance||55||A-||Yes||Yes||3||70.9 %|
|52||B||Yes & No||Yes||3||81.7 %|
|ITF Group||50||B-||Yes||Yes||3||75.5 %
Last update: September 2, 2019
Hopefully you can use this list to your advantage. I will try to keep this list up to date. If you see anything that is incorrect or missing, please leave a comment below and I will update the list accordingly.
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