In the latest episode of Income Insights, Income founder Kimmo Rytkönen and Denny Neidhardt from ReThink P2P dive into the details of two new lending partners on the platform: Ibancar, a Spanish collateral-based lender, and Sandfield Capital, a UK-based firm specializing in litigation financing. This episode highlights how each lender brings unique strengths to Income’s portfolio, aligning with the platform’s growth strategy and risk management approach.
Operational Updates at Income
To kick things off, Kimmo shares updates on new lender onboarding. He emphasizes the rigorous due diligence process in selecting Ibancar and Sandfield Capital, underscoring Income’s commitment to offering investors secure and well-vetted lending options. This careful curation reflects Income’s dedication to balancing risk and returns while expanding into niche markets.
Introducing Ibancar: Spanish Collateral-Based Lending
The first half of the episode focuses on Ibancar, a well-established Spanish lender using vehicles as collateral. This unique approach has helped Ibancar build a solid track record on other platforms like Bonster, and now, as part of Income, they’re offering loans with maturities of around 13 months and a low non-performing loan (NPL) rate.
- Strong Performance History: Ibancar has been profitable for years, with a portfolio supported by car-collateralized loans that reduce risk exposure.
- Growth Plans: While currently focused on the Spanish market, Ibancar has plans to expand into South America, which could further diversify their loan book and attract broader investor interest.
Kimmo highlights that Ibancar’s low default rates and strong pricing strategies align well with Income’s risk mitigation goals. The junior share set at 11% on Income ensures that investors have a buffer in place, adding an additional layer of security.
Sandfield Capital: Litigation Financing as a New Niche
Shifting gears, the conversation moves to Sandfield Capital, a UK-based lender focusing on litigation funding. Sandfield offers loans to pre-vetted law firms, helping cover legal costs for cases with high success rates. This business model is particularly appealing as it involves insurance that covers losses if a case is lost, significantly reducing the risk for investors.
- Unique Model with Risk Mitigation: Sandfield Capital’s loans are insured, and their vetted law firm partners carefully screen cases. This multi-layered vetting process helps ensure repayment with a structure that minimizes the likelihood of non-performing loans.
- Competitive Terms: Sandfield Capital offers an interest rate of 13.5% on Income, providing investors attractive returns within a highly structured, lower-risk environment.
Kimmo explains that Sandfield’s business structure, which includes a ring-fenced Special Purpose Vehicle (SPV) for assigned loans, adds another layer of protection for investors. With initial funding goals of around €1-2 million, Sandfield is poised to grow within Income, presenting a unique opportunity for investors interested in alternative finance.
Future Prospects and Platform Growth
As the episode wraps up, Kimmo and Denny discuss Income’s pipeline for 2024. While no new lenders are expected to on board this year, the focus remains on scaling existing partnerships and maintaining a balance of supply and demand on the platform. Kimmo encourages investors to explore auto-invest options as Income prioritises investor protection and diversified offerings.
Episode 11 of Income Insights will be a Q&A episode, during which Kimmo and Denny will once again answer your questions. You can submit your questions here: https://app.sli.do/event/pJnfVnK2HabxgWYrtajqqp
