Flender* is a new peer-to-peer lending website that has recently provided us enough information to be listed in 4thWay's peer-to-peer lending comparison service. This takes place after our experts' usual exhaustive questioning and data gathering.
One of them has written a brief summary of their key findings and an own opinion in this Flender Review:
4thWay's Quick Expert Flender Review
Lots of time needed to prove itself
Established in 2017, lenders using Flender have lent less than a million euros to Irish borrowers, who can be individuals or businesses. The loans are in euros, so UK-based lenders who normally use pounds face currency risk if the pound falls in value.
Flender uniquely requires that borrowers first borrow at least 25% from their “own crowd”, meaning friends, family and other contacts, before other lenders can take part. The own crowd might charge low interest or no interest, making it easier for the borrowers to afford the overall loan.
Flender has a lot to prove and not just because it’s brand new. Details are still very sketchy on its team, so we are unclear if they have the specific banking skills and experience we would expect to see for these kinds of loans.
In addition, Flender approves approximately one-third of loan applicants, which is very high for unsecured loans outside of payday loans, and high for a brand new P2P lending site, which should be able to be more selective of borrowers rather than less.
One-sixth of all applicants go on to raise enough money from their friends and family, so that they are allowed to get the rest from ordinary lenders on the Flender website.
It will take some years to see whether having an “own crowd” reduces the risks for all lenders, as Flender expects it to, and I'll be watching with interest to see how it does.
No loans have gone bad and lenders have lost no money, but it is very early days. We won’t know if the interest rates for lenders – typically 10% – will turn out to be sufficient for the risks involved.
Flender* is partially transparent with us, but we would like access to their data and evidence of their relevant banking training and experience.
Flender’s latest accounts show it is not yet profitable and at this early stage in its life we should expect to wait some years before that happens. Flender has no known major backers.
Unless you are a preferred lender (lending at least €100,000) you choose individual loans for yourself. Preferred lenders have their money automatically lent out. You will need to spread your money across other P2P lending sites to lower your risks and to ensure you are lending in enough loans.
Read more Quick Expert Reviews in our comparison tables.
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