In the ever-growing European alternative finance market, Lithuania – together with other Baltic countries – shows peculiarly favourable results among the crowdlending operators
Common trends in the Baltic region highlight alternative lending as a serious challenge for traditional banks and credit unions. Last year, in all of the Baltic states, alternative lending played a more significant role than ever. During the first three quarters of 2018 (January-September), 1,082 billion euro were issued through alternative lending channels. This accounted for 8.27% of the total lending activities within the region as banks and credit unions issued approximately 12 billion euro, as stated in Baltic crowdlending market report, provided by Lithuanian alternative lending operator Profitus.
Progressive governmental financial policy and positive investment environment are the main factors which create favourable conditions for investors enticed by alternative investment market, like the ones from SoFi.
By the end of 2018 there were 170 companies operating in the fintech sector in Lithuania. Most of them specialized in the field of electronic payments (44%), with lending companies (15%) as a runners-up while the banking companies in and blockchain technology operators were ranked third by the market share in the sector.
As real estate is stabilized by a balance of demand and supply, the speed and strength of the recovery will be determined by economic factors and their effect on demand in the 2000s. Banks with the capacity and willingness to take on new real estate loans should experience some of the safest and most productive lending done in the last quarter century. Remembering the lessons of the past and returning to the basics of good real estate and good real estate lending will be the key to real estate banking in the future. You can go to this web-site for more about the Belize real estate.
Real estate has traditionally been an avenue for considerable investment per se and investment opportunity for High Net-worth Individuals, Financial institutions as well as individuals looking at viable alternatives for investing money among stocks, bullion, property and other avenues. Here you will get more about the immobilier usa.
Money invested in property for its income and capital growth provides stable and predictable income returns, similar to that of bonds offering both a regular return on investment, if property is rented as well as possibility of capital appreciation. Like all other investment options, real estate investment also has certain risks attached to it, which is quite different from other investments. The available investment opportunities can broadly be categorized into residential, commercial office space and retail sectors.
Viktorija Vanagė, an expert in real estate investment field and founder of a crowdlending platform Profitus, says that the overall trends are tend to suggest that due to the consistent policy of the Bank of Lithuania in favour of fintech start-ups, the alternative lending market in Lithuania will grow even more in the following years: “The regulated and supervised environment, a growing public awareness of alternative finance markets, stringent access to traditional capital from banks and credit unions – especially for real estate development – are factors that support the increasing popularity and scale of alternative funding opportunities. In both Lithuania and other Baltic States, the number of platforms providing these services and the amount of loans they provide is increasing”. Concomitantly, there has also been an emergence in companies like moorcroft debt recovery, which help the banks in procuring the debts from the debtors. When shopping for a loan, you’ll see the interest rates expressed as a percentage and listed as either fixed or variable. Fixed interest rates will stay the same throughout paying off your loan, while variable rates are subject to change.
Total loan portfolio of the earliest Lithuanian platforms – the ones that were launched in 2015 or beginning of 2016 – has been increasing by 200% a year on average. Crowdlending operators in Lithuania doubled their revenues in the past year and show significant decrease in the cost to income ratio on year-over-year basis.
According to information gathered by Profitus, an expected annual interest rate for investors who lend their money through alternative lending platforms range between 8%-30% (consumer credit loans are expected to have an annual interest rate of 17% on average, real estate and business loans – 11%).
In other Baltic countries, similar trends of expected interest rates in alternative investments can be seen. A promised annual interest rate by platform operators’ usually range between 7% and 25% depending on the loan type (consumer credit, real estate or business loan) averaging at approximately 14% per year.
Launched in the middle of 2018 PROFITUS is one of the most ambitious and fastest growing crowdfunding platforms in the Baltic region. As a crowdlending service, it is as a mediator between those who want to invest and those want to receive funding. The investment opportunities provided on the PROFITUS platform are always secured by a mortgage. PROFITUS raises money for the development of real estate projects and other business loans; however, in all cases, the borrower must pledge real estate as a guarantee to the investors. The activities of the platform operator PROFITUS are supervised by the Bank of Lithuania.