SG Budget Babe
Asked on 02 Dec 2019
The interest rate seems too good to be true. What are your thoughts on the company? Are they trustworthy?
I have known of them from 2016, since I received their prospectus when they announced their intention to IPO on the ASX.
Based on the prospectus - short bio:
The Company was incorporated on 18 March 2015 for the sole purpose of acquiring CoAssets Singapore Pte Ltd (CoAssets Singapore), a Singapore company whose business was established in 2013. CoAssets is a web-based real estate and business crowdfunding platform. The Company operates its business in Singapore, Australia, China, Indonesia and Malaysia.
The Company’s strategy is to create shareholder value through carrying on and developing CoAssets’ existing principal businesses, and identifying new markets and opportunities.
CoAssets predominately generates its revenue via three separate streams: • Charging Opportunity Providers administration fees; • Fees charged through conferences and tradeshows; and • Fees charged from advertising and marketing through the various channels CoAssets owns, including the publication and distribution of Crowdfunders.Asia.
You can find more information here: https://coassets.com/asx/about/
CoAssets are among a few Peer to Peer microlending sites, where you lend money to small businesses that need money for a short while and pay very high interest rates for that money.
Usually these businesses either can't get a loan from a bank, or a sufficient loan from a bank, or don't want to issue short term bonds to raise this capital.
So due to the high risk, you need to be rewarded with a higher return. Thus it's possible to get double digit interest rates for your money. But also with a possibility of losing everything in a default.
Yes! I've just signed up with them though I heard that they don't get many deals on their platform due to their stringent screening of loans.
The founders' background is pretty good and they regularly hold seminars for their investors to attend and get to know the staff/managers at CoAssets. You also get a personal manager on your investment profile that checks in with you and keeps you up-to-date on any future investments and seminars.
The high interest rates definitely comes with higher default risks as this is basically a P2P lending platform to small companies or start-ups that may have a higher risk of closing down within the year or next 5 years. So if you choose to invest on such P2P platforms, be prepared to invest in money that you can say "bye-bye" to and not money that you are going to buy a BTO with. In short, be prudent and always read in detail about the deals before deciding to invest. If you have doubt, maybe start off with the minimum sum and then spread your money across different types of deals so your losses are not too great per investment. :)
CoAssets is pretty good. I've met their founders in person before and coming from the due diligence space, if they do indeed do the due diligence that they claim they do, it is in fact pretty solid https://www.coassets.com/scope-of-due-diligence/
The interest rates are higher because of the higher risks involved. But given the profile of the companies that they work with and the projects they have, it'll be up to the individual investor to read through the project details and decide if that's a risk you're comfortable to take.
Yes I have heard of them. They are a peer to peer (p2p) ledning site.
Like most P2P sites, the interest rates are higher than ordinary lenders because of the higher risks involved; they lend to small companies. As investors, we can choose our own projects we want to back; hence it is importnat for individulas to read through the project details and decide if that's a risk you're comfortable to take.