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Our users at iuvo purchase parts of loans, issued by registered non-banking financial institutions. In return, they get up to 15% annual return – much higher than expected annual return levels on bank add fundss.
All funds purchased through iuvo are secured with buy-back guarantee by the originator.* It means that the receivables in each loan that is more than 60 days delinquent will be repaid 100% to the user.
When you look at it this way, the receivable in iuvo sounds like the perfect deal. Each user must be asking himself: am I missing something? Why a financial institution would share its return with me and would cover the losses from my bad receivables?
Where’s the catch?
There’s no catch, only pure math.
Imagine that you run a non-banking financial institution – you’ve covered all criteria of your national bank, you have the required capital, the necessary processes, and expert personnel and you are registered as a non-banking financial institution. Now you’re in the lending market, and you’ve gained the trust of clients that were deemed too risky for the banks. Your risk assessment is right; people are happy with your service – they take loans and pay on time – your business is growing.
At one point the demand for your loans is higher than the money you have at hand. Unlike banks, who can always attract more add fundss to fund their lending, non-banking financial institutions can only use their funds. It means that to finance their business, they have to count on the money of their owners (equity) or debt funding (through banks, institutional users or physical persons).
It is where iuvo comes into the equation. By purchasing of receivables through the portal, our users inject “fresh money” into the lending business of the originators. In return, they get part of the return from this loan.
The expected annual return that the originator is ready to pay for this financing is higher than returns from bank add fundss. And still, it is more competitive than the expected annual return (and all other fees, collaterals, covenants, etc.) that they would have to pay if they finance themselves through a bank loan or issuing of bonds to the public.
It is why the loan originators have the incentive to keep clear and positive relations with the users on the portal, including covering the risks of bad loans because in this way they maintain their source of funding which helps them to develop their business further.
Everybody wins
It’s a win/win situation for both sides that iuvo connects. This the reason why the peer-to-peer model of financing is so successful throughout Central and Western Europe and is gaining momentum in the Eastern part of the continent as well.
Register now and start generating up to 15% annual return on receivable today!
