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Klear Analysis

Personal Loans
Direct Marketplace Lending

Last updated in November 2022.

What is Klear?

Klear Lending AD is a peer-to-peer (P2P) lending platform founded in 2015, based in Bulgaria. The company holds a financial license from the Bulgarian National Bank (BNB). Klear’s goal is to provide borrowers with low-interest-rate loans, and for investors to receive a higher rate of return when compared to keeping their money in a bank account. Investors can expect an average annual return of 5.5%, with zero fees.

Klear has over 1822 active investors (Figures sourced on November 9th 2022). Since Klear launched, they have financed over 30 Million BGN, spanning over 2700 loans. Head over to Klear statistics to get more valuable performance insights.

Key Takeaways

  • Investors can expect an average annual return of 5.5%.
  • Klear offers personal loans and is also launching an Online Credit Solution to purchase goods on e-commerce websites.
  • Klear’s majority shareholders are its founders, NV3 venture capital fund and German Varengold Bank.

Who is Behind Klear?

Klear was founded in 2015 by Loic Le Pichoux and Lukasz Lukaszewski. Both founders were senior banking executives, and have experience in Credit Risk Management.

CEO and Co-founder Loic Le Pichoux previously climbed the ladder at Cetelem, the consumer lending arm of BNP Paribas Group, and became Deputy CEO of the Central and Eastern European Region of Cetelem. His last position at BNP Paribas Group before leaving was the CEO of BNP Paribas Personal Finance in Bulgaria. He then started Klear, with a team of ex-colleagues experienced in consumer lending, to change the industry. 

A list of beneficial owners and historical annual reports can be found at the Republic of Bulgaria Registar Agency (in Bulgarian). Most notably, Klear’s founders hold the majority of the shares (50.18%), along with the venture capital fund NV3 (23.89%), which invested more than 1.5M BGN in Klear, in 2021 (according to data provided by Klear on the platform).  German Varengold Bank holds (15.22%) since 2019.

Klear's Investment Product

Klear offers personal loans to prime borrowers with a superior user experience and lower interest rates. Borrowers can finance up to 30,000 BGN with a maximum term of 5 years, a one-time funds disbursement fee and fixed interest rates.

Klears weighted average price of all loans ever financed, incur an average nominal interest rate of 6.5% and an average annual percentage rate of 8.3%.

Klear is expanding to allow partnered intermediaries to offer instant credit options to their customers. Klear is also launching an Online Credit Solution to purchase goods on e-commerce websites, a stricter version of Buy Now, Pay Later.

How Much Can You Earn?

After adjusting for the expected level of risk and delays, most investors can expect to earn an average annual return of 5.5% on the capital they provide when investing in consumer credits. Roughly 96.1% of loans processed aren’t subject to delay, and only 0.3% are subject to 4+ instalments delayed.

Investors buy rights to receive proceeds from the loans they invest in. Loans are classified by lower risk (S-A-B) or by highest returns (C-D). Allowing investors to choose the loan that best fits their risk-reward profile. The infographic below shows rates and the historical segmentation of financed loans.

There are zero fees and no hidden charges for investors. Klear earns revenue from a one-time fee, paid by the borrower when the loan is initially financed. Should a borrower miss repayment, Klear contacts the borrower to assess the situation and negotiate a plan for repayment. Klear managed to successfully recover 90% of the loans subject to delay, with 10% sold off to a third-party debt collection agency. According to Klear’s website, the criterion for default is 5 delayed instalments, without a minimum payment of 3 months.

Other Considerations

Klear isn't a bank, it doesn’t collect deposits and doesn’t offer any guarantees. Your money is not guaranteed by the Bulgarian Deposit Insurance Fund; investors may be subject to losing their principal investment.