Omaraha review

All of Omaraha’s loans are in Euro.

Although it’s possible fully secured loans, there’s basically no point in doing so. Indeed, as of May 2021, their interest rates stand at 3% ! It’s really a pitiful amount when reliable competitors such as Robocash or Moncera offer double-digit interest rates.

Omaraha‘s real strength is their partially secured loans. Gross interest rates for these vary between 17% and 35% in Estonia. There are a few loans from Slovakia available as well with even higher interest rates, but their total volume is low.

Out of this gross interest rate, Omaraha takes a 30% commission. This results in a net interest rate of 24.5% for the high-yield loans. It’s of course a very high figure; actual returns are of course lower, as the buyback guarantee is only partial.

That’s my first critic towards Omaraha : why don’t they display only the net interest ? It would make things much easier for investors.

The monthly funded volume has decreased by 50% compared to 2019. It currently stands at roughly €700,000. As a result, large portfolios probably won’t be totally invested.

Omaraha‘s partial guarantee is provided through a warranty fund. Reimbursement are triggered once reimbursements is more than 3 months late, which a longer delay than most competitors.

Before the Covid-19 epidemics, investors were compensated 60% and 80% of the loan balance. This figure was decreased in Spring 2020 in order to ensure the fund’s sustainability as the default rate increased. Since March 2021, 60% of the remaining capital is reimbursed.

This decrease allowed to stabilize the amount available in the warranty fund, which now stands around €350,000.

TODO

Omaraha is one of the longest-standing P2P platforms. Indeed, it was established in 2011 ! Its offices are located in Haapsalu, Estonia.

Most P2P provide at least basic details about the borrower : gender, age, location and so on. Omaraha doesn’t display any of it.

However, for consumer loans, information regarding the borrower doesn’t really matter. It’s much more important to lend through a reliable lending company.

Like for Robocash or ViaInvest, loans on Omaraha are originated by the platform. Unfortunately, absolutely no detail is publicly available regarding the platform’s financials.

Likewise, Omaraha’s track record is rather opaque. Registered investors have access to statistics regarding the overall loans portfolio. Unfortunately, they’re as hard to read as everything else on the website.

On the positive side, the active management of the warranty fund seems to ensure the platform’s sustainability.

At this point you’re probably starting to get the drift… In a nutshell, reporting is very poor and hard to understand.

Omaraha doesn’t provide this feature. This means investors won’t be able to resell their loans before the maturity date.

I used to invest manually in addition to using auto-invest. However, the small volume of available loans now make this a loss of time.

Moreover, the interface is just terrible. Indeed, the “Loan applications” screen – which displays the most recent loans – doesn’t support filtering. It’s possible to sort the columns, though.

Setting up Omaraha‘s auto-invest (actually called “Investment terms” on the website) is not too difficult once you figure out what interest rate to request for each credit rating. And that’s not an easy task at first.

Interest rates vary depending on the following criteria :

• Borrower’s country
• Score granted to the borrower by the platform. It stands between 0 (most risky) and 100 (safest), but only loans rated 601 or more appear on the platform. I only invest in loans with the highest rating (901+)
• Loan duration

For each duration, you can indicate the gross interest rate (paid by the applicant) and maximum amount. The bonus allows you to speed up auto-investment : it will give a chunk of interests back to Omaraha, in exchange for a higher priority. I always leave it at 0%, as I’m not in a hurry to invest my funds. The actual interest you’ll receive is displayed as “Loan interest”, but be warned that the bonus doesn’t seem to be taken into account !

But how do you figure out which interest rate to offer ? The “Offers” button displays the following screen.

This table shows the currently available interest rates for each duration and rating. Should you find it hard to use, just realize that it has been much simplified compared to the previous version !

Note that setting the interest rate slightly below the value displayed by the table may speed up your auto-invest speed, as there will be less competition between investors at lower rates.

Surprisingly, the English translation of Omaraha‘s website is really correct. Their translator is apparently much more talented than their web designer !

However, there are still parts of the website which are basically impossible to decipher. Among them, the tooltips which supposedly help us to understand the statistics.

Instructions regarding deposits and withdrawals are available under Accounts / Transfer.

Funding you account via a SEPA transfer usually takes 2 day. It will mostly depend on your bank as Omaraha processes deposits quickly. Don’t forget to fill in your reference number !

Unlike most competitors, Omaraha charges a fee for withdrawals. They cost € 0.50, which of course isn’t expensive but I obviously prefer platforms to have no fee for investors !

As a side note, Omaraha’s terrible website designer has struck again in the withdrawal page. Indeed, it’s impossible to withdraw money directly from an investing account. You first have to move funds from your specific country account to the virtual account, then you can withdraw them from this account. This adds a totally useless step to the withdrawal process.

When withdrawing funds, your bank account may not be displayed. This seems to happen if the name provided by your bank doesn’t exactly match Omaraha’s records. It may be caused by accents in your name, or if you omitted your second name. In this case, contact the support via the link titled “click here” under “Support” (once again, Omaraha’s color scheme doesn’t make this information very visible).

That’s my #1 concern with Omaraha. While there’s been some improvement on the interest rates screen, there’s still a lot to do.

For most websites, it’s straightforward to invest your money, either manually or automatically. But Omaraha makes this task rather hard, due to a poor user interface and weird design choices. We already saw that they choose to display the interest rate paid by the borrower (gross rate) instead of the interest rate paid to you, but there are other choices just as annoying.

Take the credit rating : most P2P lending sites rate credit a simple way, like A / B / C. Omaraha, on the other hand, uses a credit rating (called “score”) between 0 and 1000, and only accepts requests scoring above 600. So as investors, we only saw scores from 600 to 1000. Why not simplify the scale ,

The statistics are rather basic, and just like the rating system, you’ll struggle a bit at first before understanding it. Omaraha is also the only P2P platform I know that doesn’t provide tax reports.

Well, there’s an “Investing help” section, I can’t deny it. Unfortunately it’s totally useless, so investors are basically left alone understanding how things work.

Omaraha is overall quiet. In addition, nearly all e-mails are in Estonian only, so most of us won’t understand them.

Important changes such as the warranty fund’s mechanism aren’t announced by e-mail, only on the forums. It’s thus important to check these from time to time – the messages volume is low so it won’t take much time -.

Finally one positive aspect ! I’ve been in touch with the support twice and their answers were quick and helpful. There’s also an English forum which you can use for general questions.

I created my Omaraha portfolio in November 2016

Investor – a person of at least 18 years of age who resides permanently in Estonia or in another European Union country who has a valid identity document (passport or ID-card) issued in said country and who has signed the general Investment Terms through the Portal’s Investment Account. An Investor may also be a legal person if granting credit is not its principal commercial, economic, or professional activity and the granting of credit to a natural person is not deemed consumer credit under the law of the Borrower’s country of residence.

Because of its terribly dated website and lack of transparency, it's hard to recommend Omaraha anymore.

Please note that this review may contain affiliate links. It means that I will earn a commission if you decide to invest after clicking through the link – at no additional cost to you, of course -. Please understand that I have experienced all of these companies, and I recommend them because they are helpful and useful, not because of the commissions I make if you decide to invest through my links.