Mintos has hailed a record year for new investors and the number of loans in its 2019 annual results.
The European peer-to-peer consumer lender attracted 150 per cent more investors last year, with 136,310 backing loans. In total, it funded €2.8bn (£2.5bn) of loans through its platform, which is more than all its previous years combined since it launched in 2015.
The platform posted a 125 per cent increase in revenue to €9.1m, however, its losses grew from €276,000 to €972,000.
This was attributed to increased investment during the year.
“During the year we made considerable investments in people, product, and customer acquisition,” a Mintos spokesperson said.
“In total €1.1m was invested in the development of the platform and a further €468,000 in other operating assets.
“The loss for the year includes charges of €213,000 related to the fair value of share-based payment benefits which are being recognised over the vesting period.
“By their nature, these payments are not reflective of ongoing trading performance and they are not considered part of the underlying results.”
Excluding these charges, the result is a loss of €759,000 in 2019, Mintos said.
The platform said it has taken action this year to navigate the coronavirus pandemic by reducing spending on administrative, general, and employee benefits and it has also cut staff by 18 per cent and halted hiring.
It has also introduced a fee for selling loans on its secondary market.
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“Albeit now subsiding, in the first few months of the Covid-19 pandemic, we experienced a drop in new client registrations and existing investors putting new investments on pause and reducing their portfolios,” Mintos said.
“That has resulted in a decrease in the total outstanding portfolio, consequently affecting our commission and fee income.
“The crisis has also led to many of the risks on the loan supply-side materialising in a very short period of time which combined with imposed moratoriums have affected lending companies’ ability to collect and transfer borrower repayments to Mintos investors.
“We have seen borrower default risk, lending company risk, country risk, regulatory risk, and exchange rate risk exhibit themselves in one form or another.”
The vast majority of the portfolio continues to perform, Mintos said.
The platform said it is engaged in promoting crowdfunding regulation across the European Union and is committed to obtaining both an electronic money institution and investment firm license to operate in regulated environments.
“While the pandemic has slowed us down in making investing in loans mainstream, it has also taught us valuable lessons,” Martins Sulte (pictured), co-founder of Mintos, said.
“Making loans a viable part of a modern investor portfolio is a long-term play, and so is investing where the real returns can be assessed only over a decade or two.”
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