27 January 2017

$Thousands Moved in a Minute

There is so much pent up demand to invest cash, even when the opportunities are basically short-term junk bonds.  Each time Moolahsense launches a peer-to-peer loan campaign at 2.30 pm on a "First Come, First Served" basis, the loans are fully subscribed within a minute.

My goodness, it has become a case of fastest finger wins!  A short pop by the toilet and I missed that window. What the shit, literally.  Want to lend money also difficult. Why do they launch these campaigns at 2.30 pm anyway?

What surprises me is that most recent campaigns have been in this format while offering a high of 18% interest. "Huat ah!"

I wonder why the companies do not seek the "auction" format where the interest is likely to be lowered due to competitive offers by lenders? Is this a sign of the extent of desperation for quick cash to tide over their business needs? These companies are probably in serious cashflow deficit situations.  Cash is king.

Of 21 loans I have participated in thus far, two have experienced late payments. Potentially, they could default. The business climate is difficult.

Most lenders put up between $1,000 to $3,000 per loan. The most extreme I have come across was $10,000.  So I guess most are taking the approach of spreading across many loans of small amounts. They are really junk bonds, so some defaults are to be expected.

As a lender, notwithstanding the defaults, it has remained profitable so far. Let's see how this keeps up.

Happy Rooster New Year! *squawk*

8 comments:

SGDividends said...

21 loans and only 2 late payments....thats still a very healthy returns considering each gives 18% pa.

A sign that money is still sloshing and could mean the risk of market crashing being very slim for now.

Unknown said...

Not exactly.
That car seller default at capital match showed that some of them are borrowing from multiple places.
Also most of the delays when asked, are telling you their clients are not paying.
Can see lots of upcoming bubble bursts this year.

Anonymous said...

In situations like this, these wise words I heard a long time ago comes to mind, "If somebody wants it so badly, give it to them". Mostly, it works. Happy Lunar New Year!

Anonymous said...

I think I came across a guy lending $33k to the seafood product manufacturer.

Lizardo said...

SGDividends,

21 loans but none fully paid up yet as it's been less than a year. So who knows if there are more defaults? Risks remain. Hopefully they will pan out well.

Lizardo said...

$33K is a lot to put into something like this. Hope whoever it is will have a good outcome.

Capital Match seems to have experienced quite a bit of failures. Need to be wary of those making loans everywhere.

thedevilcorp said...

For your consideration.

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