And we are back on track!
Today is another great and important day for us – we have fully resumed DoFinance operations and new investments can be placed again!
Investors can invest their funds again!
Starting 17.11.2020 DoFinance has resumed its operations without any restrictions. Since the outbreak of COVID19, DoFinance suspended accepting new clients and investments in order not to expose investors to excessive risks. Over the course of the past 6 months the company was monitoring developments in the consumer lending market and making pay-outs to investors who expressed such interest. In this period, Loan Originators of Alfa Finance group were analysing the behaviour of the borrowers in order to assess the changes that were triggered by the pandemic. At the moment, the company is certain that it can manage the risks and they are sufficiently mitigated.
Although there is an increased interest from investors for the past few months to invest in DoFinance, only now the company feels that it is an appropriate time to start accepting new investments on top of its shareholders’ funds.
Currently, DoFinance is offering investment in consumer loans in Indonesia in 3 programs – 7%, 9%, and 11% return per annum, depending on the investment term and its respective terms and benefits.
DoFinance has reviewed and updated its programs to make them more secure for investors
In order to prepare for receiving Investment Service Provider license, the mode of operations has been improved
Besides monitoring the market and adjusting to new-normal, DoFinance has progressed in its licensing process. The company made its first submission for license in late April, 2020. During the summer our team has been preparing additional information and data to receive Investment Service Provider (ISP) license adapted for P2P issued by the Financial and Capital Markets Commission (FCMC) of Latvia. This process takes time since it is a novelty also for the FCMC. Latvia would be one of the first countries in the European Union to regulate Peer-to-Peer market operators in particular. It is expected that DoFinance will finish the process in Q1/Q2 next year.
Already now, DoFinance is converting and formalising its business to conform to requirements of FCMC and Regulation (EC) 600/2014, and allow investments in financial instrument called ‘Credit Linked Notes’. The notes will be emitted with International Securities Identification Number. In essence the investment experience will not change, and investors effectively will receive and own a part of liability of a third party. The changes will be related more to the form of the investments and underlying process. In the licensing process, already now DoFinance is supervised by FCMC.
Additional security fund has been launched!
In order to provide additional security, DoFinance has started its own initiative of creating a security fund – DoFinance Secure®. These are separate funds that DoFinance will deposit proportionally and on top of investors’ invested funds. DoFinance Secure® will be accumulating deposits that can be used in the case of negative financial events. Detailed description of how the security fund works is explained in the page ‘Security’.
Improvements to enable sufficient liquidity
Loan Originator in Indonesia has signed a long-term cooperation agreement with the buyer of delayed and non-performing loans. This agreement ensures that all delayed loans can be sold every month at a fixed price. This in turn, effectively gives sufficient liquidity to enable and trigger buy-back of delayed loans. It is a significant turning point in mitigating liquidity risks and reducing the exposure to adverse effects in the consumer lending market in Indonesia.
Other risks have been mitigated and investment programs improved
From the experience that was hard felt by DoFinance team, its investment programs have been adjusted to ensure sustainable operations of the platform. As DoFinance has showed, the most important is to do whatever it takes to keep its business running even during the periods of crisis. We are not dropping the towel but working hard to protect the interests of our investors even during the periods of severe market volatility. We have kept that promise and will keep on continuing this way.
DoFinance to launch secondary market
With the attracting of investment, DoFinance has started developing a secondary market that is planned to be launched within 2020. DoFinance has noticed that secondary market will improve the liquidity of investments and will serve as an efficient tool for early withdrawal from the investments and opportunity to earn extra profits. This is a work in progress and is planned to be finished still this year. We find this as the last missing piece to become a complete P2P platform.
Servicing of old portfolios in closed investments in Poland
Apart from all the improvements and opportunities created, DoFinance and Loan Originators are still servicing older portfolios. As promised, with the improving business performance, the Loan Originator is initiating a controlled buy-back of old portfolios. Loan Originator in Poland has just bought back a decent part of its old portfolio; hence investors are materialising very good profits from loans that have been non-performing. Absolute majority of closed investments have been positively affected. Loan Originator will continue to buy back portfolios from closed investment in batches and within the fiscal corridor.