Ready to start building on your passive income? Mintos is a great platform to start building up your passive income from peer-to-peer-lending. In this Mintos review you will learn everything there is to know about the platform.
Over the past year, I have learned a lot about Mintos. Here you will learn everything about what is Mintos, why it may be a fit for you, and how to get started.
If you also want 12.80% return on investment, stay tuned for my Mintos experience and review.
Mintos is currently one of the most popular P2P lending platforms in Europe. It’s the largest, the most advanced, and it has great returns. Mintos is the biggest European P2P lending platform with over €4.7 BILLION invested. This money is divided with over 260,000 investors from 67 countries.
With Mintos only being funded in 2015, you can see how quickly the company has grown. What has contributed to the growth over the past years is their transparency, easy use of their platform, and great returns. They offer an average return of 12.79% as of 2021.
I’ve invested over €2500 in Mintos and get 12.80% interest from that. What makes Mintos unique is the buyback guarantee and the wide selection of loan originators, making is the foundation of my P2P portfolio.
I made my first investments with Mintos in April 2019 and I totally fell in love with it.
I want to introduce you to Mintos and step up your passive income game. Currently, I have just over €170 monthly passive income. If you want to start building your passive income this is where to start!
Just as a reminder: generally in investing, the higher returns you have the more risk you take. Make sure you know the risks associated with peer-to-peer lending to make a fully informed decision!
Mintos Review: Introduction To Mintos
I am a facts gal, so let’s dive into some facts before we get going.
Mintos is a P2P lending platform that started in Latvia in 2015. They offer a wide range of loans: personal, business, short-term, car, mortgage, agriculture, pawnbroking, and invoice financing.
At the time of writing, Mintos has more than 400,000 loans outstanding in the primary market and 290,000 on the secondary market from 56 loan originators in 29 countries.
Besides that, they have paid out over €82 million to investors and have repaid over €4.1 BILLION to investors. Not bad, not bad.
Below you can see the loans funded, which is a great metric to see the growth of Mintos over time.
Mintos has amazing numbers given that it has only been around for four years. It is the biggest player at the moment and Mintos will continue to grow for sure!
Since they were able to grow their platform so much and get such a great reputation in the peer-to-peer world, Mintos is a profitable company. They are not only turning over huge amounts of loan given out but they are actually pocketing a piece of the pie. This means that they will be around for longer, given that many companies in the peer-to-peer world are still starting and not have any profit.
How Mintos Works
Mintos is a marketplace for loans, meaning that there are several loan originators that bring their loans to Mintos and sell it on the marketplace. This means Mintos does not issue their own loans and they do not put their own money in those loans.
Loan originators pre-fund the loans before selling them on the Mintos marketplace. The part that loan originators are investing in those loans in referred to as ‘skin in the game’. This is a requirement from Mintos to the loan originators to ensure they issue valid loans.
The loan originators are very important in the Mintos structure, therefore they provide a lot of information per loan originator. They even analyze them and give them a score based on the risk. This enables you to analyze the loan originators and only invest in the ones you feel comfortable with. If you want to read which loan originators I feel comfortable investing in, go here.
Why Is Mintos So Great?
Many loans issued on Mintos provide a buyback guarantee. This means that the loan originator will buy the loan back from you in case it defaults, plus most loan originators are paying the interest you missed while the loan was not paid. Missed interest paid is mostly for 60 days, because after 60 days the buyback guarantee automatically kicks in.
The great thing about Mintos is that it is an easy to use the platform, the returns are great, and the fees are low. For an investor, there are no costs associated with investing in Mintos.
Since there are so many loan originators and loan types on Mintos, it is very easy to diversify your investments on just one platform. You can start investing with as little as €10 to try out the platform and see what you’re comfortable with.Try Mintos Now
My Investments On The Primary Marketplace
Over time I have set up different auto-invest strategies that I’ve adjusted over the course of investing with them.
I have currently 161 loan investments that will yield me a net annual return of 12.24%. This is a rate I’m more than happy with, compared to what other investment options are currently making. I could make higher returns, but this is the maximum risk-return trade-off for me at this moment.
The risks with peer-to-peer lending are much higher compared to putting this money into a bank account, but the return also takes into account this additional risk.
My loans are pretty well diversified among interest rates, loan terms, and loan originators. I’m diversifying so that I’m not putting all of my eggs into one basket.
As you can see below, my current loans have a weighted average interest rate of 12.04%.
These are great returns considering that they are all backed up by a buyback guarantee and they’re issued with the biggest Peer-to-Peer platform in Europe!
The Mintos Secondary Marketplace
The Mintos secondary marketplace is a place where people can buy and sell loans, where offers can be quite attractive. It has a lot of loans available and you can sell your loans any time you want. This means a lot of liquidity for you as an investor.
Mintos is making the secondary marketplace as easy and accessible as possible. You can enable an auto-invest strategy to invest in loans from the secondary market.
I’m starting to experiment with this over the past week, trying to invest in loans with a yield to maturity (YTM) of over 15% to boost my overall interest income.
I start with only small amounts of investment through this auto-invest strategy, to try it out and see what happens.
You can also manually invest in the secondary market, just as you can invest in the primary market. If you select the loans that are matching your preferences, you can click Invest and you have them.
If you’re filtering on loans with a discount on the secondary marketplace, you can get your rate of return even higher.
Mintos Auto-Invest Tactics
I’m a lazy person – or should I say a Pareto person. I prefer to set and forget because I mostly do forget. This is why I only invest in Mintos using their auto-invest functionality. It enables me to invest in loans meeting my criteria automatically.
With Mintos, you can use the auto-invest function to set up different auto-invest strategies. When you set up your criteria, Mintos will fill your orders automatically when they meet these criteria.
What Are My Exact Auto-Invest Settings?
When you’re using the auto-invest function on Mintos, you can prioritize your various auto-invest strategies. What does that mean? Mintos will execute as many order from your highest prioritized auto-invest strategy, because moving on. I use this prioritization to invest in high-interest loans before I move on to lower interest loans.
My auto-invest strategy for the primary marketplace look like this:
As you can see, the highest priority strategies have higher interest loans. I also allow a larger investment in a single loan for those.
As you can also see, there is one red strategy name. That was one strategy I used when I was not really familiar with the settings. I am always trying and seeing how it works out, well I stopped that investment strategy shortly after. Why? Because I selected loans without buyback guarantee, because I didn’t set a maximum term (I have a mortgage of 220 months in my current portfolio, yay), and I set my interest rate way too low.
One good thing to be aware of, once you bought the loans you can only sell them through the secondary marketplace. You can’t cancel your order.
The Actual Settings
Let me walk you through my settings:
- Loan originators: I made a selection of the most reliable loan originators
- Rating: all loan originators above B- in risk rating
- Loan types: all
- Country: all
- Buyback guarantee: YES
Side note: if there are new loan originators, loan types, or countries, you have to manually enable them once they’re added. I go through my investment strategies at the end of every month to enable them.
- Interest rate: my intervals start from 14% up to 20.5%. For each investment strategy, I decrease with 1%, so my next strategy would have an interval of 13% up to 20.5%
- Remaining loan term: 1 month to 24 months
- Reinvesting: Yes
- Include loans already invested in: No
- Diversify across loan originators: Yes
- Portfolio size: Depends, I set mine to 333€ per strategy to start off with
- Investment in one loan: €10- €15
Once you press save and activate it will start to fulfill your orders. Make sure you put a cap to your portfolio size, so you can check if you set them up correctly. That’s what really saved me when I had the wrong setup. I have a mortgage for 220 months now, but luckily I only invested 10€ in that loan
Once you made an order there are no cancellations. You can only try to sell your loans in the secondary marketplace.
Read more about my actual auto-invest settings and my tactics by checking them out there!
Mintos Invest & Access
In 2019 Mintos introduced Invest & Access to their platform. It is a new way of investing that is working in addition to the current auto-invest function of their platform.
Mintos Invest & Access invests automatically for you, taking into account diversification among loan originators and loan terms. This function makes that you can quickly buy new loans or quickly sell your loans once you want to cash out.
If you want to go more into that, there is a whole separate post where I describe everything related to Mintos Invest & Access.
How Does The Buyback Guarantee Work?
A big risk with investing in P2P lending, is the risk that the borrower cannot pay the money back anymore. How does the buyback guarantee work? Does it protect you from this risk?
The buyback guarantee means that the loan originator repurchases the loan from you as an investor, as soon as the payment of delayed by more than 60 days. They will pay you the principal amount that is outstanding at that point in time, plus interest income that you have yet to receive. This means you will still get the return you were expecting to receive.
This is a good protector when you’re investing in P2P lending, but it does not protect you against all risks.
Risks When Investing In Mintos
Investing always comes with a risk, regardless of which asset category you’re investing in. I currently have around 5-10% of my net worth invested in P2P lending, and that’s about as much as I want to invest. I don’t want to put all of my eggs into one basket – one day the basket drops and all my eggs are broken.
Risks when investing with Mintos:
- Loan originator goes bankrupt: in this case, you risk losing your investments at this loan originator. Of course, Mintos tries to get as much money back as possible, but no guarantees. This can be managed by checking the loan originators really good before investing with them.
- Cash drag: this means that not all your money is invested. Because Mintos provides such great liquidity for their website, this has not been a problem for me until now. You can buy thousands of investments in 5 minutes and sell all of them 5 minutes later with no problem.
The problem can still arise when there are more P2P platforms than loan originators. At the moment we’re good, because Mintos is the biggest platform in P2P lending in Europe with great liquidity.
- Financial crises: in this case, we don’t really know what will happen. P2P lending platforms have only been around since the last crises.
- The borrower can’t repay the loan: in this case, the money back guarantee covers the loan. I invest only in loans that have a buyback guarantee, so that risk can be eliminated easily.
Of course, these are all sound reasons, but I’m not trying to scare you away.
I wouldn’t put my own money in P2P lending if I didn’t believe that the rewards outweigh the risk. I just want to make you aware of the risks that you will be potentially taken.
Aside from that, I believe that if you can’t miss the money, you shouldn’t invest in it.
Mintos Loan Originator Risk Rating
Mintos has it’s own risk rating system, which offers transparency about the risks you are facing with each individual loan originator. It’s a great tool to manage your risk using their own risk rating.
Mintos is determining the risk based on the company profile, management, strategy, risk appetite, and finances. They review these ratings every year, unless there is a need for an earlier check or update.
The risk rating system of Mintos is a unique feature, as they are one of the few P2P platforms in Europe offering this service. I love this because it gives you a quick insight into the risk of certain loan originators. You can deselect the ones that are too high- or low-risk for you.
It’s easy, you don’t have to put in all your own time, and you can select the risk you want. Just how I like it!
They have low risk (A+ to A-), moderate risk (B+ to B-), higher risk (C+ to C-) and default (D). Personally, I only invest in loan originators ranked between A+ and B- which gives me low to moderate risk.
If you’re not sure which loan originators to invest in, I have made an overview for you right here.
Since the peer-to-peer lending market is relatively new and there is little regulation, diversifying your investments with different platforms can be a good decision.
Currently Mintos is the biggest and one of the best platforms in Europe, but there are other platforms that are competing with Mintos and delivering results. It would be worth looking into other platforms to diversify your investments.
My current favorite platforms are:
Quick Summary: Pros And Cons Of Mintos
If you have read until here, or you just jumped in, chances are you want a quick overview of the pros and cons of investing with Mintos.
The pros are:
- Buyback guarantee on most loans, protecting you from borrower bankruptcy (you can select buyback guarantee when selecting loans)
- Amazing platform with many options, like auto investing, primary market, secondary market, and currency exchange.
- Great average returns of 11.45%
- Big variety of loans, countries, loan originators, and currencies – making is easy to diversify
- Credit rating listed of all loan originators, with information about the financials
- Growing quickly and consistently, offering new functionalities and more loan originators
- These is the amazing secondary market where you can sell your loans with no issues at all in a normal market
The cons are:
- Once you have a loan that you no longer want, it can be hard to sell without a loss. There are so many secondary market loans, that it’s hard to sell yours. You got to have good terms
- Manually adjust auto-invest strategies when new countries or loan originators become available
All things considered, the advantages far outweigh the disadvantages for me. BUT I am not giving you any financial advice here, so please do your own research and make sure that Mintos fits your current situation.
It took me some words to come to this, but there is just so much to tell about Mintos. As you might have noticed during the article, I’m very happy with my experiences and investments with Mintos so far. The platform is great to use, the returns are far better than other ways of investment, and there are many diversification options.
There is still room for improvement on the Mintos platform, but I feel comfortable with the risk-return ratio at Mintos. Personally I keep around 10% of my net worth invested in P2P lending platforms, to balance my risk and get the great returns that they currently pay.
Mintos is a big part of my P2P portfolio and I do not plan on changing that in the near future. Mintos performs great up until now and I am very satisfied with the returns so far.
All in all, I highly recommend Mintos as a peer-to-peer lending platform and if you’ve not tried Mintos you, you can do so here:
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If you want to try out Mintos, I have a great deal for you here: get a 0.5% bonus on your investments made in the first 90 days if you sign up using this link.
Have you tried Mintos? How do you like it?