"Grupeer is different from other p2p investment platforms. We are creating a safe environment for our clients and offer three different investment types. Our primary objective is to bring high returns to our clients with minimal risk."
and on the same page below:
"Secondly, investments are secured with BuyBack Guarantee. This means that if the borrower goes bust, our partner- the loan originator is required to buyback the defaulted loan and insure the repayment of the principal and interest in full amount."
TylerE 1470 days ago [-]
> high returns to our clients with minimal risk
That's classic ponzi language.
Upside and risk go hand in hand. You can't sustainably produce one without the other, else everyone would be infinitely wealthy.
trhway 1470 days ago [-]
man, it is the reason i posted it. Sometimes people completely miss sarcasm :)
godzillabrennus 1470 days ago [-]
If I’m reading this right then the “loan originator” is both the recipient of the Capital AND the guarantor of the buyback if it goes south.
That’ll end well.
Looks like a brother system team that worked in construction and moved into lending:
Wow it's almost like a Ponzi isn't going to straight up tell you "Hey guys, we're a Ponzi!"
They're going to do everything they can to weasel the language into making it sound like it isn't, when it really is.
pkaye 1470 days ago [-]
Is that why they are suspending payment? The BuyBack Guarantee?
erikig 1470 days ago [-]
This is the first of many such organizations that are going to go through this. All these collective funding platforms LendingClub.com, Prosper.com, FundingCircle.com, YieldStreet.com, WunderCapital.com etc are going to be forced to suspend payments to their investors as their clients face ongoing economic hardships.
bumpkinjunkie 1470 days ago [-]
They had me at: Register Now, Add Funds, Get Profit. I can't give them my money fast enough....
Sounds like loan repayments (ie principal + interest) are suspended indefinitely. This is the risk you take when you are expecting a 10+% return on property dev and payday loan investments.
toomuchtodo 1470 days ago [-]
Prosper and LendingClub loan marketplaces are of similar high risk profile in the US (the only borrowers on those platforms are those who couldn’t borrow from banks or other traditional lenders). I expect those investors will end up with interest and principal losses as well, the cost of investing in consumer subprime debt.
adrr 1470 days ago [-]
Didn’t that happen during the last recession? I don’t understand why people still put money into these unsecured loan companies.
1470 days ago [-]
gullyfur 1470 days ago [-]
I believe both LendingClub & Prosper started after the last recession.
toomuchtodo 1470 days ago [-]
Prosper existed before the 2008 GFC/recession. I had thousands of dollars worth of notes that went bad during it.
gullyfur 1469 days ago [-]
Thank you for correcting me, I was under the wrong impression
datingscientist 1470 days ago [-]
For an unsecured lender, this is basically the apocalypse. Let's do the math - numbers are US, but most of the major Western economies are going through some version of this.
- 30% household unemployment
- 90+ day shutdown of most retail / service businesses
- Implicit Mortgage and Rent holidays (no enforcement)
- Other household assets are tanking (stocks, real estate)
- Small business restart will be brutal, since the personal balance sheets & credit of owners are getting devastated
So... payment on unsecured loans... bwhahahahah. Speaking as a former banker, I'm guessing what - a 40% delinquency rate during Q2 and part of Q3? We're not just talking about the unemployed people - others have hours cut, money lost on investments, business slowdowns, etc.
Not to mention most of the population probably won't give a damm about you trashing their credit score at this point. What's the point? It's all crap now...
Oh wait... I haven't gotten to the best part. If a loan is 60 days delinquent, these guys have to buy it back per the terms of their deal. That's why they froze this thing...
At this point, it is a race between their cash reserves (what % they held back to support buybacks) and the unknown peak of a massive wave of 60 day delinquencies....
gdm85 1470 days ago [-]
> That's why they froze this thing...
You're picturing it "too honest": there are allegations of misconduct which I am afraid (given the bad quality of the recent official posts) might be true, see for example:
If they were for real, they'd announce reduced revenue and show financial statements. Sure, they're experiencing some bad debt. But not 100%.
doesn't sound that way https://www.grupeer.com/why-grupeer
"Grupeer is different from other p2p investment platforms. We are creating a safe environment for our clients and offer three different investment types. Our primary objective is to bring high returns to our clients with minimal risk."
and on the same page below:
"Secondly, investments are secured with BuyBack Guarantee. This means that if the borrower goes bust, our partner- the loan originator is required to buyback the defaulted loan and insure the repayment of the principal and interest in full amount."
That's classic ponzi language.
Upside and risk go hand in hand. You can't sustainably produce one without the other, else everyone would be infinitely wealthy.
That’ll end well.
Looks like a brother system team that worked in construction and moved into lending:
https://www.revenue.land/grupeer-interview
Trying to fund a guarantee with some clever trading strategy usually comes apart in the next downturn. See the history of "portfolio insurance".[1]
[1] https://en.wikipedia.org/wiki/Portfolio_insurance
They're going to do everything they can to weasel the language into making it sound like it isn't, when it really is.
Sounds like loan repayments (ie principal + interest) are suspended indefinitely. This is the risk you take when you are expecting a 10+% return on property dev and payday loan investments.
- 30% household unemployment
- 90+ day shutdown of most retail / service businesses
- Implicit Mortgage and Rent holidays (no enforcement)
- Other household assets are tanking (stocks, real estate)
- Small business restart will be brutal, since the personal balance sheets & credit of owners are getting devastated
So... payment on unsecured loans... bwhahahahah. Speaking as a former banker, I'm guessing what - a 40% delinquency rate during Q2 and part of Q3? We're not just talking about the unemployed people - others have hours cut, money lost on investments, business slowdowns, etc.
Not to mention most of the population probably won't give a damm about you trashing their credit score at this point. What's the point? It's all crap now...
Oh wait... I haven't gotten to the best part. If a loan is 60 days delinquent, these guys have to buy it back per the terms of their deal. That's why they froze this thing...
At this point, it is a race between their cash reserves (what % they held back to support buybacks) and the unknown peak of a massive wave of 60 day delinquencies....
You're picturing it "too honest": there are allegations of misconduct which I am afraid (given the bad quality of the recent official posts) might be true, see for example:
https://kristapsmors.substack.com/p/covid-19-first-p2p-victi...
Are they saying they're just suspending interest payments to investors, or have they actually disappeared their investors' capital indefinitely?
It looks ugly.