My opinion on Grupeer
Grupeer's pros and cons
1 month – 1 year
Buyback guarantee available
Secured loans : Grupeer’s strong selling point
Grupeer provides only secured loans in Euro. Initially the loans supply was very scarce, and my original review showed a screenshot of the five available loans as I wrote it !
Fortunately, things have changed for the best and there are now many loans to invest into. Most of them offer annual rates of 14% for a duration of less than one year. The highest-yielding loans are Russian loans offering a whooping 15% interest rate for a 6+ months duration. They’re often sold out quickly but are added back regularly, so don’t hesitate to check Grupeer‘s website often.
There are many originators available. This allows you to diversify your portfolio by spreading your investments among several originators. Clicking on a originator’s name will give you details about the loan, especially the buyback conditions.
Note that like several competitors, Grupeer uses a mechanism called “skin in the game”, which means that the originator has to keep a part of the loan (5% at Grupeer). If you look at a project’s details, you will notice that if for example the loan amount is €200 000, the initial available amount is only €190 000 – 95% of the loan amount -. The originator itself has invested the remaining 5%. This mechanism encourages the originators to provide quality loans, as they will be directly impacted if the borrower defaults !
Loan deals and development projects offer similar expected returns and durations; however, the financed amounts are much larger for development projects.
Until recently, most financed projects were located in the Baltic states; the largest project financed through the platform was Promenada, a real-estate project.
However, Grupeer has since started listing projects in Norway. Named Eidsvoll and Svolvaer, they were larger than €500 000. While their interest rate was lower than usual, at only 13% (compared to 15% for the previous projects), investors from Western Europe may enjoy the focus on locations closer to them, which them may perceive as safer.
Another recent change is the availability of amortizing loans; these loans are less risky, as the capital is reimbursed gradually, instead of being repaid totally at maturity date.
All projects are described in great details, as can be partially seen on the above screenshot.
One major difference between Grupeer and its competitors who also offer real-estate investments is that Grupeer’s development projects and business loans come with a buyback guarantee. As a result, I don’t see any reason to favor P2P loans over these, especially now that Grupeer’s loans yield up to 15% !
Buyback usually happens when loans are 60 days late or more. However, it may happen earlier for some loans; for example, one of the loans issued by Russian originator Finsputnik Platforma SIA will trigger the buyback after only 15 days ! The investor will be compensated for the outstanding principal and accrued interest that didn’t get reimbursed. Until now, none of my loans had defaulted. Note that buyback guarantee also covers the current development projects.
As mentioned before, you can find the buyback information on the loan’s detailed description.
NO secondary market available
There’s currently no secondary market; it’s supposed to arrive soon but the release date keeps on slipping so don’t hold your breath !
It’s extremely easy to invest manually via Grupeer; that’s actually how I manage my portfolio there. From the loans list, just click “Invest”, select the amount and validate. The loan will be added to your basket at the top of the screen. Once you’ve selected all loans to invest in, click on the basket icon and confirm your investments.
In May 2018, Grupeer added an auto-investing feature to their website. While the settings are rather basic, they will probably work well enough for most investors. I mostly regret the lack of an auto-diversification feature, like the one Mintos offers. Also, ironically, the FAQ mentions the secondary market, which doesn’t exist yet.
As of October 2018, it’s not possible to configure the auto-invest to invest only in the newly introduced amortizing loans.