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Post by stevec2x on Feb 16, 2018 12:28:53 GMT
Hi, I'm still quite new to Mintos and there's one thing I'm particularly confused by...
If I invest euros in a non-eurozone country, will I incur charges for currency conversion at some point? I expect the answer to be yes, but can anybody confirm or deny that please?
Cheers
Steve
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Post by falconet on Feb 17, 2018 11:08:13 GMT
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Post by stevec2x on Feb 17, 2018 12:18:45 GMT
Thanks for the reply, but that's not what I'm asking.
What I mean is that if I invest 50 euros in a loan originated by Aasa to a borrower in Sweden, presumably that borrower receives the money in the Swedish currency? If so, then somebody somewhere will charge to do the conversion, so who pays that charge? In addition, when the exchange rate changes, how is that dealt with?
Cheers
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Post by zeverare on Feb 17, 2018 14:34:41 GMT
If you invest in euro you get the same amount of euros back. The provider takes care of conversion if necessary and also the loss/profit from the change of rates.
They can buy insurance for this or just take the risk.
Aasa has loans available in krones and in euro so you can also take the risk and do the conversion yourself.
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Post by stevec2x on Feb 17, 2018 19:53:14 GMT
Thank you!
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Post by mopcku on Feb 18, 2018 9:35:54 GMT
If you invest in euro you get the same amount of euros back. The provider takes care of conversion if necessary and also the loss/profit from the change of rates. They can buy insurance for this or just take the risk. Aasa has loans available in krones and in euro so you can also take the risk and do the conversion yourself. What is interesting here is who takes the currency risk if things go wrong with the originator? If aasa goes bust do i have claim to the original borrower still in eur? Or in the currency he got the loan?
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Post by Jonas Hendrickx on Feb 21, 2018 9:57:21 GMT
When investing in foreign currencies. Make sure you have a plan.
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Post by southseacompany on Feb 22, 2018 4:10:52 GMT
What is interesting here is who takes the currency risk if things go wrong with the originator? If aasa goes bust do i have claim to the original borrower still in eur? Or in the currency he got the loan? If the original borrower has only signed a loan agreement in their own currency, I don't see what would give them the legal obligation to convert it to anything else for our benefit. So if the originator goes kaput, the currency risk is on the investors.
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Post by stevec2x on Feb 22, 2018 21:43:49 GMT
Assuming the originator doesn't go bust, then it seems to me that they are the ones who take any loss/profit on exchange rate movements. Most of them are, I assume, charging ridiculous interest rates on their loans ( on UK TV I regularly see quotes at over 1000% for payday loans), so rate movements are not going to be significant to them, but extra investment from you and me helps them to grow their business? And we only charge 12%. Thoughts anyone?
Which is pretty much the same as zeverare said, I guess.
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Post by explorep2p on Feb 22, 2018 22:24:36 GMT
Assuming the originator doesn't go bust, then it seems to me that they are the ones who take any loss/profit on exchange rate movements. Most of them are, I assume, charging ridiculous interest rates on their loans ( on UK TV I regularly see quotes at over 1000% for payday loans), so rate movements are not going to be significant to them, but extra investment from you and me helps them to grow their business? And we only charge 12%. Thoughts anyone? Which is pretty much the same as zeverare said, I guess. Stevec2x - you are right. Many of the companies recently listed on Mintos are startups. Professional investors would normally ask to receive warrants in a lending business in return for buying loans in businesses at this stage. It's highly likely that Mintos itself is receiving some kind of equity stake or warrants in return for allowing them to join their platform. That's why we think it makes sense to stick to the best quality, larger lenders (few of which have joined recently).
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stevio
Member of DD Central
Posts: 2,065 
Likes: 894
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Post by stevio on Feb 23, 2018 9:26:20 GMT
Assuming the originator doesn't go bust, then it seems to me that they are the ones who take any loss/profit on exchange rate movements. Most of them are, I assume, charging ridiculous interest rates on their loans ( on UK TV I regularly see quotes at over 1000% for payday loans), so rate movements are not going to be significant to them, but extra investment from you and me helps them to grow their business? And we only charge 12%. Thoughts anyone? Which is pretty much the same as zeverare said, I guess. Stevec2x - you are right. Many of the companies recently listed on Mintos are startups. Professional investors would normally ask to receive warrants in a lending business in return for buying loans in businesses at this stage. It's highly likely that Mintos itself is receiving some kind of equity stake or warrants in return for allowing them to join their platform. That's why we think it makes sense to stick to the best quality, larger lenders (few of which have joined recently). If not already done, it would be useful to have a thread started here discussing the quality of lenders - referencing your link. I will be happy to do so, but as its your website, maybe you would like to?
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Post by explorep2p on Feb 23, 2018 12:26:11 GMT
Hi Stevio, that's a great idea. If you are willing to kick it off, happy to participate.
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