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Post by nsiam on Dec 11, 2017 20:53:23 GMT
Hi df, The rate for the borrower is not fixed but will vary depending on the risk they introduce to the lender as well as the lenders requested return. We have no one size fits and lower risk borrower will be offered lower rate that higher risk borrowers. With regards to making to your first investment, you can divide it into potions and set different rate for each portion. Yes, this is something you can do using Welendus. I'm not sure how the risk can be properly assessed in "5 minutes application / instant decision". Will borrower's rate depend on the amount and term length? What will happen if majority of lenders set up their rates at higher end (can see that happening ) and most borrowers are assessed at lower risk? Yes, I was considering to split my investment into portions and monitor the process, but it would be good to know the grading criteria for borrower. Yes, risk is assessed by our algorithms in a matter of seconds and we decide on the loan application automatically based on the outcome of the assessment. All fully automated with no manual labour and hence the speed. yes, duration is a factor in the interest rate calculation but the value is not. If the majority of lenders choose the higher rate and the majority of borrower were lower risk, this will reflect in the pricing with the cost being slightly higher for lower risk borrowers but still cheaper than Wonga and the likes. Now, if we have lenders requesting the lower rates, they will take the lower risk borrowers leaving the higher risk borrower to investors requesting the higher rates. Note that the risk is capped at the interest rate requested. Have a look at this page, it may be useful; (https://welendus.com/investstatics.html#/action/lend) and check the "Lending Through Welendus" Section. It will be interesting to see how lenders will use the wide options and flexibility Welendus is offering. I am sure there can be an unlimited combination of investment distribution. This is not an investment advise but I would try to put equal amount at every rate to start with (there is 11 rates). Doing so, may result in a return between 8.9% - 10% (if lent continuously through out the year) and will also mean that you have the best bet at each risk level which may reduce the waiting time. I am sure different lenders may try different things.
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Post by nsiam on Dec 11, 2017 21:05:36 GMT
I have a moral issue with payday loans that I need to wrestle with. One of the main reasons why I started Welendus in the first place is to provider borrowers with an alternative to Wonga and the likes. The market and the need for short-term loans is there and will only keep on growing. If we did not provide an alternative, these customers will keep on using the bad product and even worth, the growing black market. When we developed Welendus, we developed it on a fresh blanc piece of paper with the borrower and the lenders in mind. For a starter, Welendus is cheaper for the borrower and more flexible. In addition, we work with the borrower (with technology) to help with the repayment instead of having a for-profit penalising structure like Wonga and the likes. Again, we need to provide an alternative for the growing population in need for such loans. This includes a lot of employed professionals in good jobs (including nurses and teachers for example) but just cannot afford an emergency or an unplanned necessity. You have to look at our deck to see the market size and the need out there. One more thing that I find very interesting, is that Welendus offer short-term loans from the people to the people with the return funnelled back into the society rather than going to the one company. you can lend though Welendus, you can borrow through Welendus and you can also own part of Welendus.
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kaya
Member of DD Central
Posts: 1,150
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Post by kaya on Dec 12, 2017 9:54:29 GMT
Thanx for replies Butch Cassidy buttchopf23 nsiamIt just shows that things can work out well by chance! I have my token and so may have a dabble.
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Post by df on Dec 12, 2017 14:12:17 GMT
I'm not sure how the risk can be properly assessed in "5 minutes application / instant decision". Will borrower's rate depend on the amount and term length? What will happen if majority of lenders set up their rates at higher end (can see that happening ) and most borrowers are assessed at lower risk? Yes, I was considering to split my investment into portions and monitor the process, but it would be good to know the grading criteria for borrower. Yes, risk is assessed by our algorithms in a matter of seconds and we decide on the loan application automatically based on the outcome of the assessment. All fully automated with no manual labour and hence the speed. yes, duration is a factor in the interest rate calculation but the value is not. If the majority of lenders choose the higher rate and the majority of borrower were lower risk, this will reflect in the pricing with the cost being slightly higher for lower risk borrowers but still cheaper than Wonga and the likes. Now, if we have lenders requesting the lower rates, they will take the lower risk borrowers leaving the higher risk borrower to investors requesting the higher rates. Note that the risk is capped at the interest rate requested. Have a look at this page, it may be useful; (https://welendus.com/investstatics.html#/action/lend) and check the "Lending Through Welendus" Section. It will be interesting to see how lenders will use the wide options and flexibility Welendus is offering. I am sure there can be an unlimited combination of investment distribution. This is not an investment advise but I would try to put equal amount at every rate to start with (there is 11 rates). Doing so, may result in a return between 8.9% - 10% (if lent continuously through out the year) and will also mean that you have the best bet at each risk level which may reduce the waiting time. I am sure different lenders may try different things. Yes, splitting investment across different rates is the best way to find out how it works. My guess is - if majority of lenders set their investments at 15% they might experience long queues (cash drag), which will result in lower returns. Will lenders be able to reinvest their returns at different rate? I'm not entirely clear on Auto-Match diversification. "You’ll only be able to invest up to 10% of your total investor account against each loan" - is 10% definitely per account or could it be per rate category? I'd prefer the latter and will probably invest more if there is a greater diversification.
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puddleduck
Member of DD Central
Posts: 537
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Post by puddleduck on Dec 12, 2017 20:45:50 GMT
I think the choice of name is unfortunate.
To me it reads as We Lend US which suggests a United States based operation, not UK based lender.
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Post by marx on Dec 12, 2017 22:11:42 GMT
I think the choice of name is unfortunate. To me it reads as We Lend US which suggests a United States based operation, not UK based lender. I'm getting a morally ambiguous monster from a kids' story. "The welendus lurked in its cave, wanting so very much to play with the investors." Which is, of course, deeply unfair and I apologise.
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Post by nsiam on Dec 13, 2017 12:15:36 GMT
Yes, risk is assessed by our algorithms in a matter of seconds and we decide on the loan application automatically based on the outcome of the assessment. All fully automated with no manual labour and hence the speed. yes, duration is a factor in the interest rate calculation but the value is not. If the majority of lenders choose the higher rate and the majority of borrower were lower risk, this will reflect in the pricing with the cost being slightly higher for lower risk borrowers but still cheaper than Wonga and the likes. Now, if we have lenders requesting the lower rates, they will take the lower risk borrowers leaving the higher risk borrower to investors requesting the higher rates. Note that the risk is capped at the interest rate requested. Have a look at this page, it may be useful; (https://welendus.com/investstatics.html#/action/lend) and check the "Lending Through Welendus" Section. It will be interesting to see how lenders will use the wide options and flexibility Welendus is offering. I am sure there can be an unlimited combination of investment distribution. This is not an investment advise but I would try to put equal amount at every rate to start with (there is 11 rates). Doing so, may result in a return between 8.9% - 10% (if lent continuously through out the year) and will also mean that you have the best bet at each risk level which may reduce the waiting time. I am sure different lenders may try different things. Yes, splitting investment across different rates is the best way to find out how it works. My guess is - if majority of lenders set their investments at 15% they might experience long queues (cash drag), which will result in lower returns. Will lenders be able to reinvest their returns at different rate? - Investors can opt to re-invest their return starting from the first £1.00 earned but it will have to be at the same risk/return requested for the original investment. We may look into adding more functionality later but this is how it works now.
I'm not entirely clear on Auto-Match diversification. "You’ll only be able to invest up to 10% of your total investor account against each loan" - is 10% definitely per account or could it be per rate category? I'd prefer the latter and will probably invest more if there is a greater diversification. - The diversification works per rate category first then per investor. For example, we have 2 investors and 3 borrower as follow;
Investor 1 invested £1000 at 5%, £1000 at 10% and £1000 at 15%. Investor 2 invested £1000 at 12%
Borrower 1 asking for £400 and lets assume at 5% risk. The loan will be as follow; £100 @ 5% from Investor 1 £100 @ 10% from Investor 1 £100 @ 12% from Investor 2 £100 @ 15% from Investor 1
Borrower 2 asking for £300 and lets assume at 9% risk. The loan will be as follow;
£100 @ 10% from Investor 1
£100 @ 12% from Investor 2
£100 @ 15% from Investor 1
Borrower 3 asking for £200 and lets assume at 8% risk. The loan will be as follow;
£100 @ 10% from Investor 1
£100 @ 12% from Investor 2
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Post by nsiam on Dec 13, 2017 12:22:32 GMT
I think the choice of name is unfortunate. To me it reads as We Lend US which suggests a United States based operation, not UK based lender. Will be great for a US expansion then. They will love the name there. We are a UK company serving the UK only (serving the UK only for now at least).
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Post by nsiam on Dec 13, 2017 12:30:35 GMT
I think the choice of name is unfortunate. To me it reads as We Lend US which suggests a United States based operation, not UK based lender. I'm getting a morally ambiguous monster from a kids' story. "The welendus lurked in its cave, wanting so very much to play with the investors." Which is, of course, deeply unfair and I apologise. The market is there, it’s huge and it’s in need. We are trying to make a positive change. This is still better than just saying there are bad companies out there and not doing anything about it. If everything is perfect, we wouldn't have started building Welendus from the first place.
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snowmobile
Member of DD Central
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Post by snowmobile on Dec 13, 2017 12:59:49 GMT
I note on the add investment page it states the following: (hint check spelling ) 7 days seems a long time as I'm used to debit card payments being available instantly on other platforms. Does it really take that long or is that allowing extra time for any security checks?
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Post by nsiam on Dec 13, 2017 13:18:09 GMT
I note on the add investment page it states the following: (hint check spelling ) 7 days seems a long time as I'm used to debit card payments being available instantly on other platforms. Does it really take that long or is that allowing extra time for any security checks? Hi snowmobile, thanks for the hint. Well spotted. We will correct the typo. Apologies. I agree 7 days is long. The investment will be confirmed straight away and will appear in your account immediately but you will not be able to assign it to risk/return until we receive it which takes 7 days at the moment. The 7 days is coming from our card payment service provider which we will be changing soon to reduce this time. We are on it.
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Post by funtimedave on Dec 13, 2017 14:18:50 GMT
I like the more ethical approach being discussed here. I would not profess to understand the finer details. I took the punt to invest some money on Seedrs to support the idea albeit as part of the overfunding component. Does this mean I get a token and can put some money into the platform? - I have not seen one yet but I am new to Seedrs so maybe I have to wait. nsiam My understanding is without a token I cannot put money into the platform.
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puddleduck
Member of DD Central
Posts: 537
Likes: 489
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Post by puddleduck on Dec 13, 2017 14:34:21 GMT
nsiam - Are you the also responsible for updating the website? If not, how many people are employed looking after this.
The reason I ask, is and if I sound blunt I apologise, is that your English here has a few 'ouch' typos and usage of grammar. Now on a forum, we can be relaxed about this, but probably not on a commercial website. The errors are quite similar, so do you update the site as well?
If so you might want to get a proof reader.
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Post by sayyestocress on Dec 13, 2017 17:10:11 GMT
I like the more ethical approach being discussed here. I would not profess to understand the finer details. I took the punt to invest some money on Seedrs to support the idea albeit as part of the overfunding component. Does this mean I get a token and can put some money into the platform? - I have not seen one yet but I am new to Seedrs so maybe I have to wait. nsiam My understanding is without a token I cannot put money into the platform. You won't get the token through seedrs, you need to set up a lending account on the welendus website to get the token.
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Post by funtimedave on Dec 13, 2017 17:14:42 GMT
Ahh okay - how far do I have to go?
I have set up the account but not added debit card details
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