It attempts to do so by creating a decentralised network that connects investors worldwide with under-banked small business directly. It allows easy access of funds and bridges the worldwide credit gap. It not only hosts borrowers and investors, but also hosts service providers involved in several steps of the banking process such as risk assessment, insurance and debt collection. By utilizing crypto currency, blockchain has the power to truly create an open marketplace for alternative lending. Cryptos are borderless and hold the same value anywhere in the world.
They are also used to serve as a guarantee for delivery of the service. They are used as a means to increase trust and motivation in communities. Their supply is limited, while their demand will keep increasing as the network becomes more popular. Debitum solves this problem by launching its platform globally and effectively moving capital from developed countries to developing countries, where there is already a lack of trust in centralised banks.
Investors who register on Debitum via this link will receive a 1% cashback on all investments made in the first 60 days after registration. Prior to the Internet age, most SME’s were typically able to receive loans from local banks, and building societies. Inappropriate actions, or users who underperform will be required to improve their behavior or face being removed from the community. If these actions aren’t followed up then the community leader, and sometimes even the community itself, can have their https://cryptolisting.org/s frozen until a decision is made to resolve the situation. This could include tokens being reimbursed to the affected party, ratings being dropped, or users even being banned from the network altogether.
- Investors may then use the secondary market to liquidate their loan positions, and new investors may then enter the market to positions already invested in.
- They are also used to serve as a guarantee for delivery of the service.
- However, certain issues of the platform should also be taken into account.
- In the 2023 community voting, a score of 2.72 was achieved with 32 votes.
- In order to do this, Debitum will organize participants into groups called communities.
- The system encourages each user, as well as the whole group, to participate in the ecosystem and gain more trust, by rating their actions.
These include Evergreen Capital (Estonia), Flexidea (Latvia and Poland) and Triple Dragon (UK). All the information that are covered in this Debitum review are based on my own personal experiences with the platform for the past years. Please make sure to do your own due diligence before investing on any platform. Although the platform functions on a p2p basis, Debitum realizes the need for more than a simple twofold approach. Instead the network requires three parties to form a community; the lender, borrower and investor. Our investment in the platform has always performed well, and we did not experience any defaulted loans.
Their platform is helping small and medium enterprises solve their credit problems. Businesses that would previously have been forced to close due to lack of working capital and cash flow problems can now turn to Abra 1.0 and obtain funding from global investors. This global marketplace has established itself as a market maker in the alternate financing world. Small businesses often face difficulties and closure due to lack of access to easy credit and cash flow issues.
Debitum Alternatives
For investors who prefer to invest in regulated platforms and who also want to diversify their loan portfolio outside of consumer loans, Debitum could be an interesting alternative. When focusing on business loans, one could think debitum token of the crowdfunding platform Crowdestor, which is not to be recommended. With regards to the marketplace model, alternatives such as Mintos (also regulated in Latvia), PeerBerry or Income Marketplace would come to mind.
Debitum uses third-party risk assessors such as Scorify, Coface, and CRIF as well as their own internal analysis to review and monitor the performance of your investments. Debitum is a regulated P2P platform from Latvia that finds itself in a transition process. Due to the change of ownership in 2023, the platform has become much more agile and innovative with regard to new developments and adaptations.
P2P Lending
To get access to the relevant data, Debitum offers to download tax reports and income statements from the platform. At Debitum, the interest rate for loans can vary depending on the market phase and investor demand. As an active investor who invested on Debitum between June 2019 and June 2023, I was able to achieve a total return of 8.9%. According to my previous Debitum experiences, this corresponds to a realistic return expectation.
What is Debitum Token?
Here, the monthly interest income is automatically transferred to the investor’s account. However, there is a restriction that only investors with an outstanding portfolio of 10,000+ euros can use the Auto Withdrawal function. Neither for deposits or withdrawals, nor for the functionalities when investing on the platform. Debitum is very careful when assessing new lenders, which is why there are only a few long-term partners on the marketplace.
If you have read our guide about how not to get scammed by P2P lending platforms, you know that reserving the right to change the T&C without prior notice is a big RED FLAG. You must pass the verification process to transfer funds to your account. We suggest using bank transfers as there are no fees connected to SEPA payments.
It can be used to get loans, achieve attractive returns on investment, and provide services like risk assessment, insurance and debt collection. The assets available are factoring, business loan, stock, guarantee and property. After the launch of Abra 1.0 in September, 2018, Debitum Network is working towards the first CEE Markets launch scheduled for December, 2018.
Cryptocurrencies hold the same value anywhere in the world and simplify the use of this marketplace. Debitum Network is an attractive P2B marketplace that is very easy to use. The performance of Debitum’s loans is better than on many other peer-to-peer platforms.
Debitum Buyback Guarantee
Debitum (formerly Debitum Network) is a Latvian P2P marketplace, launched in September 2018, where retail investors can invest in business loans from SMEs, earning returns of around 10% on average. Debitum is positioned in a very specific niche in the P2P environment. It operates as a regulated P2P platform, follows a marketplace model and it offers a buyback guarantee for secured business loans. This results in a combination that cannot be found on any other platform in this form.
The new investment vehicles are also called Asset-Backed Securities (ABS). In December 2023, Debitum has also implemented an Auto Invest feature. Investors have the option of having their investments selected automatically based on previously set criteria.
In addition, interest rates have risen significantly, which, in combination with their regulation, make Debitum an attractive option for P2P investors in 2024. Communities are ran by a leader who receives a fee from the community’s trust arbitrage smart contract when members are active. This will incentivize the leader to develop business and grow the community. The group is also responsible for resolving issues, and additional functions are built into the trust arbitrage smart contract so that the leader can manage this task. According to Debitum’s customer support, none of the P2P investors have ever lost any money. Based on our recent conversation with Debitum’s founder Martins Liberts, we are convinced that Debitum Network is a good fit for P2P investors looking to invest in secured business loans.
