March brought growth for the major p2p lending services. Ratesetter managed to pass Zopa and Funding Circle in newly originated loan volume in the UK. I added one new service to the table. Note that I have switched the reporting currency to Euro as all but two services are located in Europe. Several p2p lending services reached major figures for total loan volume funded since inception:
I do monitor development of p2p lending figures for many markets. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services.
Table: P2P Lending Volumes in March 2014. Source: own research Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
Notice to p2p lending services not listed: If you want to be included in this chart in future, please email the following figures on the first working day of a month: total loan volume originated since inception, loan volume originated in previous month, number of loans originated in previous month, average nominal interest rate of loans originated in previous month.
It’s been one and a half years now since I started p2p lending at Isepankur. And since my last report another 4 months have gone by. Since the start have deposited 10,000 Euro (approx. 13,750 US$). I hold over 650 loan parts – the diversification achieved is very good. Together the loans add up to 12,636 Euro outstanding principal. Loans in the value of 1067 Euro are overdue, meaning they (partly) missed one or two repayments. 490 Euro are in loans that are more than 60 days late. I already received 4,945 Euro in repaid principal back (which I reinvested).
Chart 1: Screenshot of loan status
Right now I have 206 Euro cash in the account which is up from close to zero around the middle of the month. 25 Euro are tied in bids on current loan listings and will originate in the next few days.
Chart 2: Screenshot of account balance
Return on Invest
Currently Isepankur shows my ROI to be over 27.5%. In my own calculations, using XIRR in Excel, I currently get a 25.6% ROI. In the first months there was a considerable gap when comparing these differently calculated ROI figures. As my portfolio ages, the gap is closing. The statistic section tells me, that I am currently the lender with the 15th best ROI (counting all lenders that have invested for at least 12 months and at least 10,000 Euro). Continue reading →
Even though February was a short month, several p2p lending services topped their January loan volume. Even more impressive is the continued year on year growth. 3 more services were added to the table. I do monitor development of p2p lending figures for many markets. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services.
Table: P2P Lending Volumes in February 2014. Source: own research Note that volumes have been converted from local currency to US$ for the sake of comparison. Some figures are estimates/approximations.
Notice to p2p lending services not listed: If you want to be included in this chart in future, please email the following figures on the first working day of a month: total loan volume originated since inception, loan volume originated in previous month, number of loans originated in previous month, average nominal interest rate of loans originated in previous month.
As you all know, if you are a regular reader of this blog, I have been investing on the Isepankur p2p lending service for over a year. So far, I’m doing pretty well – Isepankur consistently ranks me into the top 10% of investors by achieved ROI. But I have to admit that my strategy was just based on common sense (or call it gut feeling), some general p2p lending knowledge and experience won over time. Of course I obeyed fundamentals like diversification.
Now Isepankur is one of the first European p2p lending marketplaces that made available the raw loan data for everyone. You can download it here.
What does the data export contain?
The data export contains over 50 parameters for each loan that Isepankur orginated since February 2011. Isepankur says new datasets will be published monthly.
How do I analyse the data?
A sophisticated person – or a statistican – will rightly recommend to use multivariate statistics to most accurately get conclusions from analysing this loan data. I don’t have the tools or the expertise to do that, so I thought I just give it a try and look how far I get in Excel. By the way – this is going to be a rather long blog post, but I think you’ll find it worthwhile.
First I defined a population of loans (universe) I wanted to look at. I selected Estonian credit grade “1000” loans (thereby excluding other credit grades and Spanish and Finnish loans) to get a somewhat homogeneous loan population. Initially I looked at loans with the parameter ‘TwoMonthsFromFirstPayment’, in order to look only at loans that are old enough to default. Later I also excluded loans that originated after Sep. 1st, 2013. That leaves me with a population of 1325 loans to analyse.
What I want to find out
I am trying to find factors in the loan application that indicate an above average probability that a loan will go into 60+ days overdue. While Isepankur actually still recovers large parts of the principal of loans that go into 60+ days overdue (see these useful charts), it would still be great if I as an investor could reduce the percentage of my investments that become 60+ days late. There is a parameter in the download named ‘InDebt60Day’. This is what I analysed. Note that the description says ‘This loan has at one moment been overdue for 60 days’, meaning it does include loans that are now current again, or even paid off. But if we want to reduce the risks of a loan ever going into 60+ days overdue this is the parameter we want to look at. For 126 of the 1325 loans this parameter is set to ‘1’, meaning the average risk is 9.5%. What does that absolute number tell us? Nothing much yet, it is just a reference point I’ll use to show above average and below average risk loans.
Let’s start
Okay, I downloaded the data set into Excel and excluded all loans other than the population described above. Now I use the pivot table function of Excel to look at the data.
One easy finding is that gender influences the 60+ days risk (from now on I’ll just call it risk in short).
I marked the percentage for loans to men that has ‘InDebt60Day’=’1’ orange as it is considerably above average and the percentage for loans to woman green as it is considerably below average.Continue reading →
P2P lending service Isepankur will open to borrowers in Slovakia starting next Monday. While Isepankur is open for lenders from all over Europe this is the fourth borrower market after Estonia, Finland and Spain. I contacted CEO Pärtel Tomberg and he told me:
Slovakia is a small market with a very strong potential. We have already gathered a great deal of in small markets Estonia, a market roughly 20% the size of Slovakia, and in Finland, same size as Slovakia in terms of population, and will be looking to translate this into a successful launch. The market is quite similar to the markets mentioned earlier with a small number of large banks and lack of alternative offers to the consumers. There is a general lack of affordable and easy-to-use credit products and we will be looking to fill that void with our offer that will be very similar to what we have in Estonia, Finland and Spain. Our target would be to generate approximately 4 million euro of monthly loan volume in Slovakia in the matter of 2-3 years however as always we will start small and conservatively to ensure that only quality loans are offered to the investors.
To apply for a p2p loan the minimum income criteria borrowers from Slovakia have to fulfill are listed in the investment guide. They are roughly the same as for the Estonian borrowers. Continue reading →
In January especially Zopa, Ratesetter and Isepankur showed strong growth over the previous month. New addition to the table is the Dutch service Geldvoorelkaar, which launched in Dec. 2010 after 1.5 years of development. The CEO Martijn van Schelven told P2P-Banking.com, that Geldvoorelkaar was checked and approved by the Dutch Central Bank (DNB). I do monitor development of p2p lending figures for many markets. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services.
Table: P2P Lending Volumes in January 2014. Source: own research Note that volumes have been converted from local currency to US$ for the sake of comparison. Some figures are estimates/approximations.
Notice to p2p lending services not listed: If you want to be included in this chart in future, please email the following figures on the first working day of a month: total loan volume originated since inception, loan volume originated in previous month, number of loans originated in previous month, average nominal interest rate of loans originated in previous month.
