Having joined Swaper, a modern P2P Marketplace powered by technological innovation, now Indrek Puolokainen, the CEO of the company, with a small but very efficient and confident team behind him, is set to take Swaper to a much higher tier of the super-competitive digital finance market – become a much bigger, safer and easier place to invest your funds. The Baltic Times Magazine sat down to speak to Indrek Puolokainen.
Is SWAPER just another player in the P2P market? Where does Swaper stand out and/or hold an edge over the others?
Swaper aims to be one of the favourite P2P marketplaces in Europe and charm investors with ease of use and great returns. We are glad to experience that Swaper is appealing to investors from all walks of life - starting from those who are about to make their first investment as well as those who live solely on passive income from their investments. Swaper makes investing easy and great returns with a fair BuyBack policy are the cherries on top.
As I am old school with bank accounts in several banks, what could be attractive for me about trying out a P2P platform like yours?
Old School is cool! And it’s great to have multiple bank accounts, but it’s not very wise these days to have money just sitting on bank accounts while the inflation quite literally eats it up. That’s why so many people are now into investing. I personally find that Swaper is the perfect place to start your investment journey, but it’s also the place to keep growing your money when you already know what you’re doing. We have placed great effort in making the platform as simple, rewarding and fair as possible. Thus, the signing up process is rather quick and straightforward, setting up your Auto-Invest Portfolio is made as simple as possible, deposits and withdrawals are quick and easy, which means that you can have your money back on your bank account hassle free in case of any emergencies with your financial state.
Currently, all of the loans we offer onsite come with a BuyBack, which means that in case the borrower fails to repay within 30 days from the due date, a BuyBack kicks in and you are automatically paid the principal amount that you initially put in the loan, as well as the interest for the whole period that you funded the loan. We have been on the market since 2016 and so far 9 out of 10 of our investors are happy with what we’re doing. I think that speaks for itself.
Besides, if you’re new to p2p investing, you’ll want to check out our blog section. We are dedicated in helping more ordinary people gain both the experience and the knowledge around investing. Thus, we publish simple and educative posts about different sites and strategies on investing first thing every Monday. Make sure to check out the articles we have for you here already:
How has the COVID-19 pandemic been for the Baltic P2P market in general? And for Swaper?
The start of the pandemic was a bit scary for everyone. Investors did not know how things would roll out and thus a lot of them decided to temporarily fold their cards to see what happens next. We were, however, certain that we have the capacity to adapt and push through. So we helped our investors find their peace of mind and the way back to us by keeping them updated regularly and by offering interest higher that the market’s average. Thanks to all of this we can say that apart from the starting point in this corona crisis, our growth has been steady and smooth. It’s evident that investors all over the globe feel a lot more confident about the status quo and the future of their funds.
As you explain on your website, the crowdlending or marketplace lending you offer, involves the element of investing in unsecured personal loans. The word “unsecured” may spook some?
It may spook some, but it will definitely attract others; specially those who are prepared to take a little risk in order to earn great interest from placing their money on assets will find it attractive. See, by nature, an unsecured loan carries a higher risk for the loan originator when they issue the loan. Thus, in order to secure their business and cover the costs, these consumer loans come with a higher interest rate for the borrowers. A higher interest rate in turn allows the loan originator as well as the platform to offer higher interest for investing in these loans. The more experienced in p2p investing you are, the more you realise that it’s not as much about the type of loan that offers security but it’s a lot more important to find a platform and loan originators you can trust. In Swaper we offer BuyBack for all the loans on platform, which means that there’s not much difference security wise whether you invest in unsecured or secured loans. As a little teaser, we can also say that we have the intention to offer a wider selection of loan types on Swaper platform in the near future.
Do you see rising competition for the P2P market from the bitcoin and the other cryptocurrencies?
I don’t actually see cryptocurrencies as a competition at all. I rather believe that the investment industry should be as rich and abundant as possible and the growing pluralism and the growing level of financial knowledge demands a wide selection of investment options. I mean, there are different strategies, but I find it wise to diversify portfolios between various assets. As with everything else in life, it’s important to invest responsibly and I find that it also includes not placing all your eggs in one basket. As my background is involved with cryptocurrency, I hold strong faith in cryptocurrencies and look forward to what the future will hold.
All financial investments come with a level of risk. Crowdlending can be risky, and we have seen some platforms be illegitimate but with the right amount of diversification, upsides definitely outweigh the downsides as it offers great opportunity to make a decent return with no additional cost (at least with Swaper). I would say the best motivation in investing is the constant money flow and you can start with small amounts and see the cents coming home on a monthly and weekly bases. First cents, then euros and then more euros.
What are the other P2P lending benefits?
The first advantage is the high yield it can offer. It does not require much knowledge and it’s a type of investment that you can just set up and leave for a while, without excessive need to constantly keep an eye on it. There are few or no fees associated with P2P lending. For example, in Swaper we do not have any fees for investors, so no deposit or withdrawal fees, or account management or fees for selling on the secondary market. So all interest you are making, is yours to keep. Moreover, unlike with stocks or cryptocurrencies, there is no need for a daily analysis of the price, to keep up to date with the asset’s financial results or find the perfect timing for selling or buying assets. With P2P you can just set your Auto-Invest Portfolio up and know that your funds are growing.
Can you walk me through the coming changes/improvements in P2P lending after an EU law and an Estonian law are adopted this autumn?
The biggest change is that the companies related to the industry need to be licensed in order to operate. Among other important changes P2P platforms need to follow all the AML and other related regulations. We have been doing that already for some time and we are constantly updating our related policies and procedures. I find the upcoming regulation crucial for segregating great platforms from scams and websites that do not treat investors fairly. It thus offers investors more security, but it’s also beneficial for platforms to have specific guidelines and the option to make sure their internal procedures are matching them.
I think the entire P2P market is changing and developing and that is not only because of the new EU legislation. You do not find 40% of interest from P2P loans any more that was possible some years ago. Investors are getting smarter and also stock market is changing with all the money printing and pandemic. As for Swaper, we are working hard to bring more investment opportunities to our platform so our customers can diversify their portfolio.