A marketplace with a single loan originator, offering attractive yields and a handsome bonus
|Total Investment Volume||€225m+|
|Average annual interest||14%|
|Who's eligible to invest||EEA bank account holders|
|Investment Type||Marketplace lending|
|Auto Invest Function||Yes|
|Investor Protection||Buyback guarantee|
|Website Language||English, German|
PROS & CONS
- High interest rates and a generous loyalty bonus
- 30-day buyback
- Two currencies
- Limited diversification
- Little transparency on the loan originator
- Low availability of loans
- A fixed interest on all loans has been raised from 12% to 14% in Spring 2020, which elevated the expected returns well above the industry average. But that’s not all – you can earn an additional 2% loyalty bonus and increase your yields to 16% if you invest €5,000 or more over three months.
- Sweet returns are followed up by a 30-day buyback guarantee, which covers both the principal and the accrued interest. It ensures a good level of liquidity and prevents investors from losing interest on delayed loans (as long as the platform withholds its buyback promise).
- When registering with Swaper, you can choose to open your investor account in either EUR or GBP, which helps avoid currency risk. It’s a particularly attractive option for UK investors, who want to diversify into investment opportunities in continental Europe but avoid currency exchanges.
- All deals are short-term consumer loans originated by a single lending company – Wandoo Finance Group. At the time of writing, Wandoo issues loans in Poland (through wandoo.pl) and Spain (wandoo.es). I have two main problems with that – first, by exposing your capital to a single company, you ‘put your eggs in one basket’. Second, the Polish P2P market has proven weak and volatile, with several loan originators and P2P lending platforms launching and quickly folding their operations – we looked into this issue in our January Funding Report.
- Another problem is we know close to nothing about Wandoo’s financial conditions as they don’t publish any financial statements. Swaper’s 2019 financial report is available and records a profit of just over €400,000 for the platform itself. The health of the group as a whole is, however, a much more important issue in properly assessing the reliability of offered investments.
- Although there are some indications that loan availability is improving, you need to consider that cash drag (i.e., your capital lying idle as there are no deals to invest in) might be an issue.
Who is behind Swaper?
Indrek Puolokainen is the newly appointed CEO (since July 2020) – he seems like the right person for the job, with relevant experience in finance and marketing. Young but competent women fill the remaining three positions that are listed on the About us page.. No one from the top management, however, has been with Swaper from the start – the longest tenure has been just over two years. Wandoo employs a total of 124 people across their five offices – you can take a look at their management structure here. I haven’t found any information on the company ownership.
What does Swaper offer?
Wandoo offers up to 30-day consumer loans starting from €50 up to €1,500. Until recently, deals from Denmark were also available, but now we’re down to only two locations – Poland and Spain.
How much can you earn?
Unless the (parent) company folds, you can expect a pretty stable ROI of 14% or 16% – if you invest more than €5,000.
Who is Swaper best for?
Due to elevated risk, uncertainty about the loan originator’s financial condition, and severely limited diversification options within the platform, I wouldn’t put all or even a big chunk of my capital there. However, Swaper can be considered a good high-yield addition to an already well-diversified portfolio. Swaper is also very beginner-friendly – flat interest rates, high liquidity due to short maturities, and a basic auto-invest option can make it one of the platforms in which you could start your P2P journey.
How to invest at Swaper?
Registration is easy. Before you can start investing, you need to verify your identity by uploading and going through an ID scan. Once your account is cleared, just set up an auto-invest strategy - that’s the only reasonable way on Swaper - and enjoy your passive earnings. Weirdly, investors from Poland and private investors from Estonia are not accepted at the moment, even though they are EEA countries.
Swaper would be high up my ranking of high-yield platforms if it wasn’t for the poor transparency about the parent company/loan originator. Currently, the performance of your loans depends on a single company that you know very little about – it’s not a set-up I’m comfortable with. Opening up the books and maybe enlisting more loan originators or at least more loans from different Wandoo locations would, I believe, make Swaper more worthwhile.
At P2PMarketData we are dedicated to providing unbiased reviews of peer-to-peer lending, real estate crowdfunding and crypto lending platforms. Among other, in our mission to bring more transparency to the market we closely monitor and track over 70 platforms funding volumes.
When reviewing an alternative investment platform, we consider a variety of factors such as:
- Number of investors
- Minimum investment requirement
- Historical annual returns
- Diversification opportunities
- Reinvestment opportunities
- Educational and informational offerings
- Platform fees
- Total capital invested
- Features (such as secondary market and automatic investing)
- General transparency (the difficulty of finding who the owners are, how they make money on the platform (fees), terms & conditions and more)
- Management team
We also look into the company’s online reputation (for example customer reviews, news, complaints, average monthly searches and social media).