If you’re looking to diversify out of the traditional stocks and shares space, it might be worth considering the merits of a peer-to-peer (P2P) lending site.
While the specifics will vary from platform-to-platform, the overarching concept is that you will be lending your money to those that seek financing. In doing so, you’ll likely benefit from double-digit annual returns, albeit, this will come with higher-than-average risks.
One such platform that claims to offer annualized returns of 11% is that of Viainvest. The Latvia-based P2P site facilitates both business and consumer loans, with the latter covered by that all-important Buyback Guarantee.
Moreover, the originator behind the loan must put up a minimum of 5% of the loan value, subsequently ensuring that enhanced due diligence is performed on the end borrower.
In our Viainvest review, we explain how the P2P site works, where your money ends up, how much you should expect to make, and what risks you need to consider prior to signing up.
Viainvest at a Glance
|Viainvest - Visit
|Peer to Peer Lending
|European Union or Switzerland
What is Viainvest?
Viainvest is a P2P lending platform that facilitates consumer and business loans. The site is owned by parent company VIA SMS Group – which was founded in 2008. Based in Riga, Latvia – Viainvest allows everyday investors to loan their money out in return for fixed interest. As such, the platform is suited for those of you that wish to make passive income.
In terms of the loans themselves, consumers loans are typically on a short-term basis. This could be for a number of days, weeks or months. Loan sizes will average a few hundred Euros, and the end borrower will be expected to make fixed repayments until the loan is settled in full. Viainvest is also involved in larger business loans.
Regardless of which loan type you decide to invest in, the platform allows you to get started with just €10. This is ideal for those of you that wish to diversify as much as possible, as your Viainvest basket can contain hundreds of individual loan agreements.
Crucially, the platform offers a Buyback Guarantee on all consumer loans. This means that were the end borrower to default, the originator behind the agreement will purchase the debt in full. In doing so, you’ll get the full investment amount back – no questions asked.
As we cover in more detail further down, all of the loans listed at the Viainvest platform are covered by the originator by at least 5% of the total funding amount. This acts an additional safeguard in itself, not least because the originator will have a financial incentive to ensure it only loans money to those that can afford to meet their repayments.
Finally, unlike other P2P sites in the space that offer varying interest yields depending on the type of loan you’re investing in, all loans at Viainvest come with an annual yield of 11%. This ensures that you always know exactly how much you are likely to make.
Eligibility at Viainvest
Before going any further with our review, it’s best to outline the minimum requirements to invest with Viainvest. You will need to be:
- Aged at least 18 years old
- Be a tax resident in the European Union or Switzerland
If you don’t personally meet the residency requirement, Viainvest does permit accounts opened by companies registered in the aforementioned regions.
How Does the Investment Process Work at Viainvest?
There is a structured financing process employed by Viainvest and its parent company VIA SMS Group. First and foremost, Viainvest partners with a number of European originators that deal with consumer and business loans.
Those that require financing will go directly with the originator, and the originator will perform the required due diligence. Not only does this allow the originator to determine the affordability of the borrower, but also the specific interest rate that should be charged.
Once a loan is approved by the originator, it will then make its way to the Viainvest website. In doing so, it allows members of the site to make an investment of just €10.
As we briefly noted above, all of the loans that end up at Viainvest will be backed by the originator by a minimum of 5%. It might be more than 5% if the platform is unable to fulfil the entire loan amount from members of the site, albeit, this is rare in the case of consumer loans.
Nevertheless, the overarching point here is that by having a financial interest in the loans at Viainvest, the originator will ensure that end borrowers go through a stringent due diligence process.
How Much can you Make at Viainvest?
All of the loans listed at Viainvest come with an annualized yield of 11%. Although this is a healthy amount of interest to make on your investment, it is important to remember that the end borrower will actually be paying much more than this.
Not only is this how Viainvest makes its money, but it’s also what covers the Buyback Guarantee. As such, the yield of 11% might not necessarily reflect the risk of the end borrow, as the originator will be charging a higher APR rate.
Minimum Investments and Deposits
The minimum investment that you can make per loan is €10. This ensures that you can diversify as much as you like. For example, by depositing €2,500 at Viainvest, you could effectively invest in 250 different loans.
When it comes to funding your Viainvest account, the platform does not accept debit/credit cards or e-wallets. Instead, you will need to deposit funds via a bank transfer.
The bank account controlled by Viainvest is based in Latvia, so you’ll need to perform a SEPA payment. Once the funds arrive, it can take an additional 2 working for Viainvest to credit your account.
In terms of getting your money out of Viainvest, you will need to make a withdrawal back to your bank account. Before the withdrawal is authorized, the platform will ask you to upload some ID. This needs to be a passport or government-issued ID card.
Getting Your Money Back at Viainvest
Once you have made an investment at Viainvest, the end borrower will enter into a legal loan agreement. This centres on the date(s) that the repayment needs to be made, and at what figure.
The payment cycle will depend on the term of the loan. For example, if it’s an instalment loan of between 2-12 months, then the borrower will make fixed payments on the same date of each month – until the loan is repaid in full. If the loan is on a short-term basis of less than a month, then the borrower will make a single repayment for the entire loan amount plus interest.
Every time the borrower makes a payment, they will do so directly to the originator behind the loan. The originator will then forward the funds onto Viainvest, who in turn, will credit your account. The cash is then available for withdrawal, or to be reinvested in other loans at the platform.
Viainvest Risks and Buyback Guarantee
All investment products come with an element of risk. This is especially the case when you consider the 11% annualized returns offered at Viainvest. At the forefront of this is a default by the end borrower.
The good news is that Viainvest offers a Buyback Guarantee on all of its consumer loans – but not its business loans. For those unaware, a Buyback Guarantee is offered by a number of P2P sites, and it ensures that investors are compensated in the event of a default.
In the case of Viainvest, the originator will purchase the debt from investors if the end borrower is late for payment by more than 30 days. As great as such an assurance is, the Buyback program is not a guarantee per-say. This is because you need to consider the potentiality of the originator itself defaulting.
If they did, and they were unable to cover the Buyback Guarantee in full, it is not certain whether or not Viainvest or its parent company would step in. If they didn’t, you could lose your entire investment.
On the flip side, the originator will charge borrowers much more than the 11% yield paid to you. This ensures that the originator has a reserve pot of some sort, so it is hoped that the Buyback Guarantee will always be honoured.
Manual vs Auto Invest at Viainvest
Much like other P2P lending sites in the space, Viainvest gives you the option of choosing your investments manually or activating the auto invest feature.
If you want to have a more hands-on approach to investments, you can personally select the loans that you back. With that said, manually investing at the platform would make it somewhat cumbersome to maximize your diversification strategy. This is because you would be required to make hundreds of manual investments one-by-one.
As a result, it might be best to opt for the auto invest feature. Viainvest allows you to set up your loan parameters, which ensures that the platform only makes automated investments that meet your requirements.
- Size of each individual investment
- The term of the loan (in months)
- Type of loan
- Loan originator(s)
On top of making the diversification process easier, the auto invest feature ensures that you reinvest your profits as soon as they are paid – subsequently allowing you to enjoy the fruits of compound interest. You can amend the auto invest parameters at any time, or switch it off all-together.
How to get Started With Viainvest?
Like the sound of Viainvest and think the platform is conducive for your long-term investing goals? If so, getting started couldn’t be easier. Simply follow the step-by-step guidelines listed below to get up and running TODAY!
Step 1: Open an Account
Head over to the Viainvest website and elect to open an account. You will need to provide the platform with a range of personal information, such as your
- Full Name
- Tax Residency
- Date of Birth
- Home Address
- Contact Details
Step 2: Deposit Funds
You will need to deposit funds before you can make an investment. It can take Viainvest a couple of working days to credit the funds, so it’s best to do this straightaway.
You will need to fund your account via a bank transfer, which needs to be through the SEPA network.
Step 3: Choose Investment Strategy
Once your Viainvest account has been credited, you’ll need to decide whether you want to invest manually or via the auto invest feature. If opting for the former, you can browse all of the available loans manually. And the latter – you’ll need to set up your auto invest parameters.
Step 4: Receive Payments
Once you have invested in a loan(s) at Viainvest, the end borrower will be required to meet their repayments on time. Once payments are made, the funds will be credited into your Viainvest account.
You can then reinvest the money or withdraw it back to your bank account. If you elected to reinvest the funds via the auto invest feature, Viainvest will do this on your behalf.
Viainvest Review: The Verdict?
In summary, Viainvest offers a very attractive annual yield at 11% – which remains constant regardless of the loan type. This is much higher than what traditional investment spaces typically return, and it can all be done on a passive income basis. Crucially, the platform offers a Buyback Guarantee on all of its consumer loans – but not business loans.
In theory, this ensures that your investments are covered by the originator in the event of a default. We also like the fact that the originator is required to inject at least 5% of the loan amount. This means that originator will have a vested financial interest in the loan and thus – will ensure that it performs the required due diligence on the end borrower.
Ultimately, although there is much to like about Viainvest, just make sure you consider the risks. The Buyback Guarantee is only as good as the originator behind it, so your money is never 100% safe.