Who are the most solid lenders on Mintos? Our Mintos lender ratings

Last update - November 2017

A Mintos lender recently blew up

In June 2017, Mintos lender Eurocent announced that it was in serious financial difficulties. We covered these problems in a recent post. Eurocent has now defaulted on its Mintos 'buyback guarantee' commitments. It looks increasingly likely that Mintos investors will suffer some losses. 

This has inevitably led investors to pay more attention to the quality of the other lenders on the Mintos platform. Recently we listed 9 lenders that we would not touch right now. We have now broadened our analysis to cover all of the Mintos lenders. We highlight the lenders with the strongest features. We continue to be big fans of the Mintos platform, however we are allocating most of our capital to the highest rated lenders listed below.

It has been difficult up to now to compare each lender on the Mintos platform

Unfortunately, the information provided by Mintos about each lender is not consistent. Some lenders have not provided any information since March 2015. Others provide very regular updates. Information is provided in different currencies, languages and accounting policies. The quality of information provided varies enormously. Some information is audited, in many cases it isn't. There should be minimum standards of reporting and disclosure. At the moment, there does not appear to be any requirements at all. 

Key financial information of each Mintos lender

The table below captures the key financial information for each lender. This can be useful to quickly lookup the profile of each lender, and compare the strengths and weaknesses of each one.

Mintos has not provided any recent useful or reliable data for the following 5 companies - Pangmaobao, Nord Lizings, Agrocredit, Acema, Mano Unija. We have had to exclude them from our analysis, but in the interim we would not purchase any loans from these lenders until proper disclosures had been provided.

All Figures in EUR million:

Mintos LenderReporting periodLoansEquityP&L - latestP&L - prior yearAudited
MogoJune 201780128.62.7No
ID FinanceSep 201757.418.66.67No info provided
Credit StarMarch 17/ Dec 1647.712.81.61.3No
Capital ServiceDec 201611.05.31.42.0Yes
iute creditDec 20167.82.11.00.7Yes
Banknote / Money MetroJune / Sep 1713.74.32.91.0Yes
CreamDec 201621.62.61.11.3Yes
IFN Extra FinanceDec 20167.03.72.01.8Yes
BIG MicrofinanceDec 201611.43.20.31.1Yes
Mozipo Dec 20166.44.00.50.6Yes
AasaDec 201644.328.61.8-3.0Yes
AfortiMarch 20172.51.20.20.1No
CapitaliaDec 20163.40.40.00.0Yes
LendoDec 201611.73.0-1.6No
EcoFinanceJune 20171.61.91.30.2No
ITF GroupDec 20161.31.10.20.1Yes
HipocreditDec 20160.60.10.0-0.3No
DebifoMarch 20172.50.30.00.0No
Kredito GarantasDec 20161.00.10.20.1No
EuroOneOct 20171.41.4-0.5-0.7No
Get bucksDec 20150.0-0.3-0.30.0No
Cash CreditDec 201631.40.2-0.1Yes

Our Mintos lender ratings

Our Mintos lender ratings are based on 5 characteristics - profitability, capitalisation, size, track record and the quality of their reporting. We have allocated marks out of 20 for each metric, giving a total score out of 100. 

Top rated Mintos lenders

Mogo and ID Finance earned the equal highest scores. Mogo is a popular lender on Mintos as the loans are both secured by vehicles and most receive buyback guarantees. Mogo reported very good results in Q1 17 and appears to have a successful business model. ID Finance is another lender that is well capitalised and has produced strong results over the last 2 years. 

We think investors can have some confidence in any lender achieving a score of 60 or better. Lenders meeting this benchmark include Credit Star, Capital Service, iute Credit, Banknote, Cream and IFN Extra Finance. We particularly like the quality and frequency of reporting by Credit Star and Capital Service, and allocate some capital to their loans. 

Aasa recently released their 2016 results which showed impressive growth and a move into profitability, resulting in their score improving significantly and they are now well above our 60 score threshold. We have also recently upgraded the score of Banknote / Money Metro following strong results during 2017.

Lower rated lenders - our views

Of the lower rated lenders, Get Bucks, Kredito Garantas, Debifo and ITF Group were all included in our list of 9 lenders we would avoid right now.

Lendo is effectively a startup with no real trading history prior to 2016. It has been given a reasonable amount of equity to use to get to a breakeven profit level. One concern we have is that the business lost €1 million during 2016 due to FX differences between the Euro and the Georgian Lari. This suggests that their FX exposure has not been fully hedged, and the business could suffer if the Lari loses value against the Euro. This is something that Lendo should provide better disclosures about. 

Hipocredit is a startup mortgage business. It used to be an affiliated company of Mintos, however it is now owned by new shareholders. During 2016 the previous owners of Hipocredit appear to have withdrawn €500k of equity, leaving it with only €135k. It's not clear why this was done.  The business made a small profit in 2016. We cannot recommend purchasing Hipocredit loans currently, as they have recently been selectively buying back loans from Mintos investors (which they are allowed to do under the assignment agreement with Mintos investors). This has resulted in Hipocredit 'cherry picking' the best performing loans, and leaving behind investors with defaulted loans.

EuroOne joined the Mintos platform in November 2017. The business is extremely small, and has a history of losses, and as a result has a low rating. 

Lenders receiving marks in the 40-59 range need to be treated with caution. Some of them are small but promising, and others have a few question marks over them. We would not allocate a large amount of capital to these lenders.

9 thoughts on “Who are the most solid lenders on Mintos? Our Mintos lender ratings

    • Oscar Harrington Post authorReply

      Thanks Matteo. Yes we plan to keep this updated (it has been a popular post).

      • tbee Reply

        Thx Oscar
        this is really helpful especially when it is kept up to date
        e.g. mogo jetze offers car loans in other countries and these do not seem to return as reliably back

  1. Alex Reply

    Hi Oscar,
    I’ll attempt to explain why I came to your site.
    I have a company in one of the European countries and the way taxes work here is that when you withdraw profits (via either salary or dividends) the taxes you pay are very high. However, if you don’t withdraw, there is no tax.
    I currently have a situation where the company has more funds than can be invested back in the business. Due to the nature of the business there are limited ways in which to expand the primary operation. As a result, I have 100k EUR+ in available funds on the company bank account. I haven’t taken this profit for reasons above (taxes you pay once you draw funds from the company).
    Because of all this I started to look for alternative ways to invest excess funds and came across lending platforms. Mintos is especially interesting due to guaranteed returns. I have been reading a lot about this topic lately and if I understand correctly, if I stick to loans with buyback guarantee, the only risk is the lender not being able to pay outstanding obligations similar to Eurocent? Furthermore, if I stick to lenders you rated high, is there still some risk in this and if so what is it?
    Also, I am looking to invest approx. 50k EUR. Would you say that’s feasible?

    Furthermore, how would you allocate the funds between lenders (my criteria is EUR only and buyback guarantee only, target 11% ROI)? For example: 20% Mogo, 20% ID Finance, 20% Aasa, 20% Banknote, 20% Cream. Or some other proportion? How would you calculate this proportion based on the overall score of each lender?
    Thanks for reading and for such a useful post.
    Alex.

    • Oscar Harrington Post authorReply

      Hi Alex. For loans that have buyback guarantees, the risk comes from a situation like Eurocent as you correctly identified. That is, the borrower firstly defaults, then the lender is unable to fulfil the buyback guarantee. These risks are correlated – if a lender has many loans that are defaulting, that also makes them less able to fulfil the guarantee, as they will be suffering high losses, and the company could fail. That’s why it is important to monitor the level of profit and equity for each lender. There is still a risk that a highly rated lender could fail, it is just a reduced risk. Allocating your investment to multiple lenders is a good idea, to diversify your risk. You could use our scores to allocate your investments, but make sure that end up with a portfolio that has good diversification in terms of geography, loan types etc.

      • Alex Reply

        Reply:
        Hi Oscar,
        Thank you very much for your reply.
        So would it be a good idea to invest 100k EUR in Mintos and split it in 8 parts:
        Mogo, ID Finance, Credit Star, Capital Service, Aasa, iute credit, Banknote, Cream.
        Eight equal parts would be 12500 EUR each but I would likely allocate more to larger companies regardless of the score. For example, I am familiar with Mogo, ID Finance and Cream Finance, but never heard of iute credit.
        You suggested that it’s important to have good diversification in terms of geography, loan types etc. Could you elaborate on what techniques you would use to achieve that goal?
        Thank you,
        Alex.

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