Paskolu klubas P2P lending platform is a good choice for experienced long-term investors. They offer a stable supply of loans with good returns.
The company was incorporated on February 2014. They used to have the best platform in Lithuania, before FinBee updated their platform. Now they have a 2nd best platform in Lithuania.
Over the last few years I have deposited €25,553.62 to Paskolu klubas P2P lending platform. The platform provides a stable supply of loans with a properly working auto-invest functionality and low attention requirement so one can easily set it up and leave.
Return on investment
The calculated rate of return averages to 16.12% at the time of writing and the net rate (after tax) is a little under 12% (see the financial summary for October 2019). Paskolu klubas automatically deducts 15% income tax for non-residents from earned interest every time the loan installment is received. If you live in UK, you can fill in DAS-1 form to get the tax reduced to 10% - see their FAQs for more info.
Option to sell bad loans
You can sell your overdue loans for 40-70% of their original value depending on their rating. You also get 10% extra (bringing it up to 50-80%) if you have a VIP investor status, which you earn if your portfolio exceeds €5,000.
Quick withdrawal processing
I had to widthdraw 2 times in the past and the widthdrawals have always been expedient with money reaching my bank account in 1-2 working days.
A unique feature in Paskolu klubas is the ability to automatically invest in secondary-market. I haven’t had time to play with the feature myself, but if configured properly I could see it increasing your overall returns.
When investing you can choose to activate a “Provision fund”, which covers the payments in case there’s a delay. Personally I do not use this, as I am able to take a higher risk and wait for longer to get a greater return.
The platform meets my security requirements as they offer a two-factor authentication (2FA) when investing where they send you an SMS code to your phone number. Withdrawals are only permitted to the accounts you deposited from, which further reduces the chance of someone taking over your account and stealing your hard-earned money.
The biggest 2 issues I see with Paskolu klubas at this time is a high rate of defaults and a cumbersome loan selling process. The former has a lot more weight than the latter when I evaluate platforms, but it depends on the personal circumstances of the investor.
High default rates
The numbers speak for themselves here. I’m still waiting for the late fees to kick in and bring the average returns number up, but for now the rate of defaults seriously hamper my portfolio’s performance. While average interest rate stays at over 16% it is reduced almost proportionally by the defaulted rates (16% x 72.74% ~= just under 12%). While in Savy the returns have picked up as the late fees started coming in (see the financial summary for October 2019), I’m yet to see that happening in Paskolu klubas.
Loan selling process
The selling process is a bit cumbersome. I have been caught out once when I’ve stopped auto-investing in the primary market, started selling loans and then realized that auto-invest portfolio in the secondary-market was absorbing all the cash. So make sure to turn off auto-invest in secondary market when selling loans. Funding circle handles this really well, because they warn you when selling if your auto-invest is turned on.
Otherwise the process is similar to the one in Finbee - you have to select the loans you want to sell (up to a maximum of 25 loans, which is really annoying), set the price and then put them up for sale. It takes a couple of days to sell the loans, but it’s hard to see as there isn’t a good interface to see all of the loans that are up for sale.
There’s a lot of room to improve this process.
Paskolu klubas platform verdict for 2019
It was a promising platform early on, but I’ve stopped putting more money in it for now and will observe how the recovery process works and whether late fees eventually pick up. If they do, I will start putting more money in.