IBAN WALL: First Impressions & Review

S4F ReviewsAnalysis Iban Wallet @ Savings4Freedom
I decided to stop promoting iban wallet on my blog. Too many questions without answers, too much smoke around people, locations, finances and operations. A warning message to all.
iban Wallet: A Warning Message
Risk Management

iban Wallet: A Warning Message

By November 4, 2020 0
I decided to stop promoting iban wallet on my blog. Too many questions without answers, too much smoke around people, locations, finances and operations. A warning message to all.
1 2 3 5
iBAN Logo @ Savings4Freedom

iban Wallet is a fintech startup that follows an asset-backed loan investment model similar to Robocash: black box loan investing. This means that you don’t know the loans that are receiving your investment, you are only able to select the investment tier and duration.

You can invest and earn your interest daily from 2.5% up to 6% per year, being able to deposit and withdraw money daily. The minimum deposit and investment amount required is €1.

Funded in July 2016 in the UK, the company received funding through multiple crowdfunding campaigns that financed the development of the iban Wallet App, launch in March 2019 and the business development to recruiting investors in Europe (mainly from the UK and Spain) and borrowers globally.

iban Accounts do not fall under any government-backed deposit protection schemes (such as the FSCS in the UK) and all investment done is at risk. iban Wallet is not a savings account.

iban Wallet Platform Quick Review

iban Wallet offers among the lower interest rates in the business. The highlights of iban Wallet are: interest payments on a daily basis and you can deposit and request withdrawals when need to (without any charge). This was the particular element that called my attention, a fixed return with immediate liquidity.

Creating an iban Wallet investor account is straightforward. Registration is extremely simple and the platform is very easy to navigate. You need to have a phone number associated with your account to receive security codes and validation codes.

Analysis TopicPersonal Take
Type of Loans @ Savings4Freedom

Type of Loans Available

Interest Rate @ Savings4Freedom

Average Interest Rate 

2.5% – 6% (daily interest payment)
Buyback guarantee @ Savings4Freedom

Buyback / Secured Loans

Yes (asset backed or property backed loans)
Early Exit @ Savings4Freedom

Early Exit / Secondary Market

Yes (immediate)
Autoinvest Feature @ Savings4Freedom

Auto Invest Feature

By default
Control over loans @ Savings4Freedom

Control over Loans Invested

Money Drag @ Savings4Freedom

Money Drag

Hidden Fees @ Savings4Freedom

Hidden Fees

Loan Duration @ Savings4Freedom

Loan Duration

1 day to 5 years
Report Quality @ Savings4Freedom

Reporting Tool

Low Quality
User Experience @ Savings4Freedom

User Experience

High Quality

iban Wallet: Origins

The first question to answer with any new P2P player is who they are and where they came from. The company was founded back in July 2016 by two entrepreneurs: Daniel Suero Alonso, CEO, Marc-Anthony Hurr, and the Portuguese Pedro Freire. The project passed through multiple different ideas and pivots, but the focus on exploring loan investing opportunities in Latin America seems to be there since the very beginning, even if now the loan originators are from all over the world, with no specific concentration region (LATAM is only one more). On a pitch deck to investors from 2016, it was possible to read: “iban – First crowdlending marketplace connecting Europe and LATAM“.

In the words of iban Wallet co-founder and CEO, Daniel Suero Alonso, in January 2017, the idea for iban Wallet came from his analysis of the P2P market:

Currently all the major players in the P2P lending space are receiving money and lending within a single country, primarily focused in Europe, the US and Asia. Alternative lending is only just arriving to LATAM, and with it the associated lower loan rates, so there’s a huge connected population waiting for this technology and business model to arrive. By lending cross-border in a mobile application, we can provide simpler and cheaper credit access to all those individuals, at fair local rates, enabling us to pass on the financial gains to the lenders that come with lending in a developing economy.

Daniel Suero Alonso, iban CEO

iban has already launched five successful crowdfunding campaigns to provide seed capital to the company – three on Crowdfunder (UK & German markets) and another two on Seedrs (UK) in April 2017 and July 2018 – attracting investors at a valuation of £20,070,491.

This money was used to create the complete app and back-end system, forming partnerships with specialist technology operators to offer secure banking and loan services, as well as opening offices in London, Sevilla, and Lisbon, as well as managing the lending operations in Latin America.

iban Wallet launched the mobile App for peer to peer lending operations in March 2019, with a new image and brand voice.

iban Wallet Founders: Daniel Alonso, Marc-Anthony Hurr, and Pedro Freire

The founders behind iban Wallet are three young entrepreneurs from Spain, UK and Portugal: Daniel Alonso, Marc-Anthony Hurr, and Pedro Freire. I want to highlight the experience of Pedro Freire prior to iban Wallet, having followed the entrepreneur path.

iban Wallet Financial Track Record

No clear data is available regarding iban financial operations. On a pitch deck employed back in 2017, the company presented more than 500 borrowers and 2000 investors using their services. With around £100,000 in deposits and over £2.7 million in loan requests. You can check the available information on the images below.

Since the beginning, the company was developed to ensure financial sustainability. From the same investment deck, it was possible to understand the proposed business model for the company.

Project Default Levels

The iban platform states an impressive 100% non-default track record. But considering that iban Wallet accounts offer a fixed interest rate, regardless of the amount, term and investments made on loans, it makes sense that this P2P lending company is capable of offering multiple protections to its investors. You exchange interest for immediate liquidity.

The company states that all the iban Wallet loans are backed by property, have a Buyback Guarantee and a Safeguard Trust which has covered all bad loans since it launched. This means that until this moment not a single investor has lost money.

iban Wallet Due Diligence

iban Wallet Project Selection Due Diligence

Before accepting the loan, iban Wallet executes a due diligence procedure for each prospective Loan Originator:

  • Diversification: there are typically several loans associated with your iban Wallet account.
  • iban Wallet performs a thorough analysis of financial statements, management quality, underwriting policy, credit scoring, investment portfolio performance, and data accuracy to ensure that the Loan Originator follows the strict risk standards of iban Wallet.
  • After the launch of the partnership, iban Wallet continues monitoring the investment for risks on an ongoing basis.
  • Only under 1% of all applicants are selected for a loan: iban Wallet selective applicant process, careful analysis of credit scores and detailed evaluation of the collateral, and low acceptance rates reinforce the safety of iban Wallet accounts.

iban Wallet Investor Protections

iban Wallet guarantees your investments even in case of default of the project. How?

Asset-backed loans

Designed specifically to offer investors an asset-secured investment. All iban Wallet loan investments offer the opportunity to receive fixed returns over an agreed investment term, with the capital being returned at the end of the chosen investment period with an interest paid daily, secured by other financial assets.

Investment underwriting policies

On an individual loan level, the loan originator issues loans in accordance with their own established underwriting and credit scoring policies, although are supervised by iban Wallet. These include not only the industry-standard processes, but also a series of advanced checks – identity, credit, affordability, and fraud – to ensure borrowers are creditworthy.

Buyback guarantee

To protect investors, all Loan Originators have a Buyback Guarantee on all loans. The Buyback Guarantee means that if the payback is delayed by more than 90 days, the Buyback Guarantee will repurchase the investment for the nominal value of the principal and the accrued interest till the date of repurchase. This is all done automatically and the interest rate of the investment product will not be affected whatsoever. This is possible because Loan Originators typically receive higher interest rates than the rate they offer to iban Wallet investors. The difference covers administrative and marketing costs, as well as constitutes the profit margin of the Loan Originators.

Safeguard Trust

The iban Wallet Safeguard Trust is a provision capital account with reserves which provides investors with protection in case any Loan Originator fails to administer the investments. To fund the Safeguard Trust, a proportional monthly balance is set aside without affecting your investment. iban Wallet collects that amount to hold in the trust for investors.

Therefore, in the unfortunate event any loan or Loan Originator defaults, investor money is first backed by the asset given as collateral to the loan, a Buyback Guarantee and finally the iban Wallet Safeguard Trust.

iban Wallet Repayment Schedule

iban Wallet accounts are investment accounts providing a fixed daily interest paid on a daily basis. This is one of the most interesting features of this P2P lending platform in comparison with others.

iban Wallet Investment Accounts

iban Wallet currently offers 4 different investment options:

You need to be aware of the simplicity of the approach but also of the slight details that can make a huge impact on your returns. For example, you have 1000€ to invest in P2P lending and waiting for the right moment to invest. Instead of keeping the money in your bank you can decide to transfer to iban to the standard iban account and earn 2.5% AER (Annual Equivalent Rate) on a daily basis until the moment to transfer the funds to your desired investment opportunity. In the case you select the option One, you only will obtain a daily interest after the first 365 days from the moment you invest, making it not a true option for experienced P2P crowdlending investors. With Mintos Invest & Access and other similar options available in the market investments for short-term are less attractive in iban Wallet.

This is my personal take on the subject, but I’m curious to learn your ideas and comments on this particular topic.

iban Wallet Skin in the Game

No information is shared if iban Wallet participates in the fund.

iban Wallet: How to Start

To start investing within iban Wallet you need to set up an account, choose one of the available investment accounts and the amount of money you would like to invest. It will take only a few minutes.

The requirements to open an account is to be at least 18 years old and be a resident in one of the countries in which iban Wallet offers its services (available in the majority of European countries and also in the United States). It accepts transfers in EUR and US Dollars.

Here is a step by step instruction: 

  1. Login or Register an investor account;
  2. Introduce your email address;
  3. Introduce your mobile phone contact;
  4. Upload documents for personal verification process;
  5. Top-up your account with funds (SEPA transfer or credit card);
  6. Choose the account to invest;
  7. As soon as you receive your funds, 25€ will be added after some days;
  8. Interest will be visible on your dashboard daily.

My experience joining iban Wallet

It took me less than 5 minutes to register on the website, upload a copy of my national card ID. I’ve funded my account through my N26 account debit card, and the funds became available to invest a few hours later.

Few days after I received the funds, iban Wallet added 10€ to my balance. You can also benefit by using my referral link to open your account.

iban Wallet: Platform Future Steps

One element that was present on all investor decks from iban was the recurrent idea of becoming a new generation of a bank.

From the list presented in the image above, only a part is complete. Let’s see what happens in the near future and explore as the solution growths.

iban Wallet: Conclusions

I look into iban Wallet as a great way to keep receiving interest from the money I actually need to keep accessible to my immediate needs. Until now, neither the N26 Account, Revolut or TransferWise were able to offer savings or investment accounts that combine daily interest payments with immediate liquidity. This is the space iban Wallet is filling for me in the near future.

iban Wallet: A Warning Message
Risk Management

iban Wallet: A Warning Message

By November 4, 2020 0
I decided to stop promoting iban wallet on my blog. Too many questions without answers, too much smoke around people, locations, finances and operations. A warning message to all.
1 2 3 5

What to learn more about Iban Wallet?

iban Wallet @ Savings4Freedom
Check all articles about Iban Wallet

Iban Wallet Alternatives and Competitors

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  1. Hi John,
    Thank you for your comment.
    In fact, they work with loan originators from all around the world.
    I’m asking them for a full list of loan originators. I always prefer to know this. Until the moment they didn’t publish the data.

    Since it was founded the business model changed in a significant way. Let me share my understanding of their public statements.
    Considering that iban Wallet accounts offer a fixed interest rate (quite low in fact), regardless of the amount, term and investments made on loans, it makes sense that this P2P lending company is capable of offering multiple protections to its investors. This means that they can loan your money to a diversified group of borrowers from lower risk to higher risk and even with a potentially high level of default answer to any payment request by actual clients in the platform.

    Example: you deposit your money. After 1 year you should receive 2.5%, right? And if they lend your money at a 10% interest rate to a borrower in Asia? This means that you are making your 2.5%, and if the borrower pays, they will make 7.5% in interest from your money… more than enough to cover potential losses from other deals, right?

    I will continue to ask for the loan originators and for a clear publication on the blog about this subject.
    It is especially important that they come forward with this information to the general public that are not aware of what is P2P lending.

    For the moment I’m quite happy with the performance of my account, but watchful of any potential issues.
    What do you think of my rationale?
    Happy to have your opinion.

  2. According to their website, the interested from IBAN wallet needs to be filed for a tax (as of standard P2P lending). Then the 2.5% interest seems will result in profit below inflation rate. Still better than zero profit, just need to consider the efforts when using this wallet.

  3. Hi Marek,
    Thank you for your comments.
    You are right! You need to consider the tax implications. However, I personally don’t use iban as an investment tool, but as a short term resource allocation with small interest when you need to have funds available to be moved in a few days. Full liquidity while earning a little interest.
    You can also consider that from time to time, iban offers extra interest that can help to overcome the inflation and tax burden. 🙂
    Have a great 2020!

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