“New technology enables a new type of investor to invest in an established asset class. Through new technology it is possible to connect investors with borrowers through a digital platform. The borrower gets a better interest rate, while the investors get a better return on their savings capital compared to traditional savings accounts. It is simply a win-win situation for both borrowers and investors. ” “We are today Sweden’s largest marketplace for loans and have some of the country’s leading entrepreneurs as owners. Among Kim Madas’s owners there are, among others, the Vite founders and parts of the Nills and Wolleyn families.
Is it safe for me as an investor?
Kin Madass is a platform that connects investors with borrowers. We handle the administrative process, from credit assessment and drawing up of agreements between borrowers and investors to the payment of loans and administration of payments. We do what the bank does with unsecured loans (bank loans), what we do not do is stand for the capital, but so do our investors who take the risk but then also get the return. ”
“Most of our investors choose to invest in a basket of loans, what we call autoinvest accounts. The investor chooses the maximum maturity of underlying loans and then we manage the entire risk spread.
The expected annual return after fees and expected loan losses is between 4 percent and 6 percent depending on maturity.
As an investor, you can also choose to invest in a manual account where you manage your risk spread yourself and can then choose loans based on risk class and maturity. ”
“We have a vision to democratize the financial industry and enable everyone to invest on our platform. Therefore, we have the same conditions for both large and small investors. What differs somewhat depending on the size of capital is the risk spread between the number of loans. If you invest USD 10,000 in an Autoinvest account, your capital is divided into at least 40 loans. If you invest USD 50,000 or more, your capital is distributed to at least 50 different borrowers. If you invest USD 100,000 or more, your capital is distributed to at least 60 different borrowers. If you invest USD 1,000,000 or more, the capital is distributed on at least 125 loans. There is no maximum investment limit. ”
“We only offer the most creditworthy borrowers loans. We carry out a very thorough credit assessment. Our average borrower has a fixed income of about USD 370,000, is 43 years old and otherwise has a good and sound economy. We strongly distance ourselves from SMS loans with short maturities and very high interest rates. Those who borrow through Kin Madass are established people who, for example, borrow to renovate their home.
Our estimated loan losses are about 1 percent, which is in line and is slightly lower than the market for the same type of loan. It is important to remember that the history and competence surrounding the asset class can be obtained and recruited, what is new is that the technology enables ordinary private individuals to invest in loans that were previously reserved for the banks.
Kin Madass has also set aside his own funds in a so-called credit loss fund, which is intended to cover invested capital in the event of any loan losses. However, the loan loss fund is no guarantee but there is a buffer. The loan agreement is between the borrower and the investor and if Kin Madass could not carry on his business in any way, it does not affect the agreement between the investor and the borrower.
To increase security, Kin Madass also has an agreement with Lindorff regarding back up services, which means that Lindorff undertakes to build processes and knowledge so that they can take over the management of the loans. Liquid funds that have not been invested in loans are placed in a client funds account at one of the major banks and are separated from Nick Adam’s own assets. ”
How do you check the identity and creditworthiness of the borrowers?
“We secure the borrower’s identity with the help of BankID. The creditworthiness of each borrower is carefully analyzed and only persons with sufficient ability to pay are approved. We do a traditional credit report through UC. If necessary, we also include employer certificates and copies of salary specifications. Furthermore, we make a calculation based on the borrower’s income and costs where we estimate the borrower’s ability to cope with the monthly payments – one left to live on the calculation. ”
How and when do I start to get a return on my investments?
“All loans are repaid monthly with amortization and interest from the borrowers. You as an investor can then choose to pay off the amortization and interest each month or alternatively to automatically reinvest the capital in new loans. ”
What should I think about before I start investing?
“Investing in loans to creditworthy private individuals gives a risk spread to your overall portfolio if you otherwise invest in equities and traditional fixed income investments. As in all types of investments, it is all about spreading their risks. You spread your risks if you invest in a basket of loans, which you do through our autoinvestment accounts. You are the investor who gets the return on the loans and you take the credit risk. ”
How do I get started?
“It’s very simple. All you need to do is register with BankID and deposit capital via a direct transfer which takes a few seconds. Then you get to choose what type of account you want to invest in: Autoinvest account or manual account. “