Startup Smava.de starts offering p2p lending in Germany. Anybody can lend or request a loan online. Borrowers, after registering will by checked for identity and credit grade by smava. Smava uses PostIdent (a service offered by German postal service Deutsche Post) to verify the identity of the borrower and relies on credit report information from Schufa, a leading German credit bureau. Smava is only open to borrowers with credit grades A to F (which smava says leads to expected default rates between 1.4% and 7.2%).
After validation the borrower can post his request which can range from 500 to 10000 Euro and state the interest rate he is willing to pay. Lenders can bid in intervals of 500 (minimum) Euros.
If the loan request is fully funded the loan is payed to the borrower which will repay it in monthly rates for a period of 36 months. The borrower has the right to payoff early anytime (without any additional fees).
Smava does not take fees from the lenders. Smava charges 1% fee of the loan amount from the borrower.
An interesting though complicated instrument are the so-called Anleger-Pools (engl. lender pools). The purpose of these is risk spreading over all loans of a given creditgrade. Say a specific B loan is not payed back. In this case this would lower the repayment on all B loans (not just this specific one). Does this mean the lender can invest in any loan regardless of description. No because this instrument applies only to repayments not to interest due.
Due to German regulation smava, which is a startup founded as limited company, had to partner with a bank. While there are different views on whether under German laws a banking licence is required to run a p2p lending platform or not, Smava chose the safe route by partnering with the ‘Bank für Investments und Wertpapiere AG (BiW)’. This way deposits are secured by the German Einlagensicherungsfonds. Deposits which are not lend out, do not earn interest.
Some interesting feature, when viewed in comparison to Zopa, Prosper and Boober:
- There are individual listings (like Prosper)
- There are groups (like Prosper), but seemingly no group rewards
- There is no auction bidding down interest rates (or I missed it)
- In case of non-payment (for over 40 days) smava has the right to sell the loan to the collection agency Intrum Justita for a percentage of the value
- maximum a lender can loan is 25000 Euro
- maximum per loan is 10000 Euro
- minimum bid is 500 Euro
- only German residents can borrow or lend
- no interest on unlend deposits
- simple fee structure (borrower pays 1% of loan amount), no late or other fees
- new Anleger-Pool (lender pool) concept for risk spreading on defaults within same credit grade
The management team behind Smava has a lot of ecommerce experience. I could not determine when smava launched publicly, according to forum and loan activity it can have been no more then a few days ago.
Smava already received press coverage by a large regional newspaper.
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