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NEO Finance Analysis

Personal Loans
Direct Marketplace Lending

Last updated in January 2023.

What is NEO Finance?

NEO Finance, founded in 2014, is a profitable P2P lending company that has granted over EUR 128 million in loans in Lithuania, with a loan portfolio of over EUR 50 million. It has also invested over EUR 3 million in its own software for managing its P2P lending business. In 2017, NEO Finance got an electronic money institution license allowing it to provide services throughout the European Union. It also has a P2P consumer lending license from the Lithuanian Central Bank. NEO Finance has issued 18043 loans, with more than 14,160 investors on their platform. 

Head over to NEO Finance statistics to get more valuable performance insights.

Key Takeaways

  • NEO Finance shareholders include ERA Capital UAB, Grigory Gurevich, Value Capital UAB, and Asian Pacific Green Energy PTE. LTD, and minority shareholders.
  • NEO Finance AB operates under three different brands: Paskolų Klubas, Neopay, and FinoMark.
  • The average advertised return rate for Lithuanian consumer loans is 12%.

Who is Behind NEO Finance?

Evaldas Remeikis is the founder & Chairman of the board at NEO Finance. As of July 2022, he also assumed the role of Head of Administration. NEO Finance AB operates under three different brands: Paskolų Klubas, Neopay, and FinoMark. As of Q3 2022, NEO Finance AB owned 94.13% of the shares of FinoMark UAB.

Paskolž Klubas provides P2P lending services in Lithuania, while the NEO Finance brand provides services to EU, Free Trade Association, and European Economic Area citizens. NEO Finance acquired the FinoMark crowdfunding platform in 2020.

FinoMark, a subsidiary of NEO Finance, has seen its loan volume grow by a factor of 4.45 due to a small comparative base and a stronger focus on sales. In Q3 2022, NEO Finance’s EBITDA and pre-tax profitability both increased by 17% and 38%, respectively, compared to the same quarter of the previous year. Loans granted in Q1-Q3 2022 totaled EUR 26.5M, or 29% more than the EUR 20.5M financed in Q1-Q3 of 2021. Profit before taxes for Q1-Q3 2022 was EUR 82 657. In Q1-Q3 2021, pre-tax profit was EUR 258 130.

NEO Finance shareholders include: ERA Capital UAB owns 73.49%, minority shareholders 10.55%, Grigory Gurevich 9.90%, Value Capital UAB 3.69%, and Asian Pacific Green Energy PTE. LTD owns 2.37%.

NEO Finance's Investment Product

Paskolų Klubas, operated by NEO Finance AB, is the largest P2P lending platform in Lithuania. Neopay is a licensed provider of payment initiation and account information services, and FinoMark received permission from the Bank of Lithuania to carry out crowdfunding activities in February 2021.

NEO Finance offers two investment methods: 

  • Manual selection of loans from a list of borrower applications that includes information on the borrower's income, creditworthiness, and previous debts. 
  • Automatic investment through the creation of an investment offer with specified parameters such as maximum investment amount, loan maturity, and creditworthiness of borrowers.

NEO Finance has also introduced new services such as Buy Now Pay Later and POS Lending in the Lithuanian market. NEO Finance’s secondary market also includes the possibility for investors to buy and sell investments in consumer credits.

How Much Can You Earn?

Paskolų Klubas, offers high advertised returns for investors between 8-16%. Finomark allows for investments of more than 500 EUR per loan, with an advertised average interest of 11%. NEO Finance’s average advertised return rate for Lithuanian consumer loans is 12%.

NEO Finance AB's buyback service allows lenders to sell their investment to the company within 30 days of the termination of an agreement with a borrower at 50-100% of its remaining face value.

NEO Finance’s partnership with a debt collection agency resulted in 65% of debts being collected within two years. At the end of Q3 2022, 8.62% of 35,240 outstanding loans were overdue by more than 90 consecutive days, and 8.78% of the EUR 117.5 million in loans issued were more than 90 days overdue. During Q3 2022, EUR 651,000 was recovered and distributed to lenders. Debt recovery has taken an average of 2 years.

With Neo Finance no additional fees apply when investing in the primary market, but in the secondary market, both selling and buying investments are subject to a 1 % brokerage fee.

Other Considerations

At the end of Q3 2022, Neopay was available in Lithuania, Latvia, Estonia, Finland, Sweden, Norway, Denmark, the Netherlands, Poland, Greece, Romania, Spain, Croatia, Bulgaria, and Slovakia, integrated into over 200 financial institutions.