Investors

Important Points
Investment and Risk
Fees
How does LEND manage credit risk?

LEND checks each borrower against creditworthiness databases in our parameterized application process and assign a risk score based on our proprietary risk model and further data from third party providers.

Low default rates are our top priority.

Is there a minimum investment?

Yes, the minimum investment amount is CHF 500 and CHF 1’000 for larger projects.

Is my commitment to fund a loan binding?

Yes. Once you have confirmed your investment you are bound to honour that commitment.

Are partially funded loans paid out to the borrower?

No. We request that a loan is fully financed.

How do I receive interest and repayments?

LEND manages and monitors the entire payment process. All payments are processed via a settlement account PostFinance. We transfer payments from borrowers proportionally to the investors' bank account.

Could I lose my investment?

Investors must be aware that a total loss of the investment is possible. As an investor, you are solely responsible for your investment decisions. The rating or interest rate are not a binding measure of the borrower's actual solvency, and LEND does not make any recommendations regarding investments.

There is no deposit protection for loan claims or investments, and LEND or the borrowers are not directly subject to supervision by FINMA. However, LEND is a member of SRO Polyreg and a regulated financial intermediary.

Is my investment secured?

For personal loans, borrowers can purchase payment protection insurance (PPI) against the risks of unemployment, death and disability. Mortgages are secured by a property, and for business loans we regularly work with joint and several guarantees or property as collateral.

We indicate on each project whether collateral exists. Despite collateral, a total loss of an investment cannot be ruled out.

What do the different loan statuses mean?

Committed amount: Loan requests that you committed to invest in which are still in funding, under review, or in the process of being paid out.

Current: Loans that are up-to-date on outstanding payments.

In Grace: Loans that are “In Grace” are up to 15 days past the due date.

Late 15+: Loans that are “Late 15+” have not been “Current” for 16 to 30 days.

Late 30+: Loans that are “Late 30+” have not been “Current” for 31 to 45 days.

In Collection: Loans that are in “Collection” are loans for which Switzerlend AG started the Collection process. In general, a loan enters “Collection” status when it is 45+ days past due.

Default: Loans that are in "Default" are loans for which borrowers have failed to make payments for an extended period of time. In general, a loan enters Default status when it is 120+ days past due.

Charged Off: Loans become “Charged Off” when there is no longer a reasonable expectation of further payments.

What happens when a borrower fails to make a payment or pays late?

If borrowers fail to make a payment on the due date, they are automatically in default without a reminder letter or other notification. We will send reminders and, where necessary, take further action.

Under certain circumstances, we are also entitled to withdraw from the loan agreement and demand repayment of the entire outstanding amount. However, our goal is always to get borrowers back into a position where they can pay on time again. Our own internal specialists handle these cases.

As an investor, you can check the status of your investments in your LEND account at any time. We will also keep you informed about individual cases in the event of longer payment delays.

What happens when a loan enters the status Collection, Default or Charged Off?

Collection: Loans that are in “Collection” are loans for which Switzerlend AG started the Collection process, i.e. debt enforcement. In general, a loan enters “Collection” status when it is 45+ days past due.

Default: Loans that are in "Default" are loans for which borrowers have failed to make payments for an extended period of time. In general, a loan enters Default status when it is 120+ days past due.

A loan that is in “Default” will still appear in your investment overview, in the status of “Default”.

Charged Off: A loan becomes “Charged Off” when there is no longer a reasonable expectation of further payments. In certain circumstances, loans may be charged off at an earlier or later date. Please note, loans for which borrowers have filed for bankruptcy may be charged off earlier based on the date of bankruptcy notification.

Switzerlend AG may sell charged-off loans to a third party. In the event that a charged-off loan is sold to a third party or funds are recovered on a previously charged off loan, investors will receive a pro rata share of the sales proceeds or recovery amount, respectively, less any fees. In general, recoveries on previously charged-off loans are infrequent.

A loan that has been “Charged Off” will appear as charged off, and the remaining principal balance of the loan will be deducted from your outstanding balance.

How does a high level of diversification affect my earnings?

As an investor you should invest your overall investment amount in as many loan projects as possible, creating a diversified portfolio.

We generally recommend at least 20 different investments, because then the total loss of a loan only amounts to 5%.

What happens to my investment in the event LEND no longer exists?

It is important to us that our investors do not have to bear LEND's counterparty risk.

We have therefore chosen a legal structure that would allow investors to enforce their investments against borrowers even without LEND. Technically, investors purchase a (partial) loan claim from LEND and receive it by assignment. This gives them an independent claim against the borrowers. LEND's bankruptcy does not change this.

An investor could therefore collect its (partial) loan claim directly from the borrower. This is of course not the aim and, as long as LEND is responsible for administration, this is contractually excluded. 

We assume that even if LEND were to cease business operations, the management and settlement of current loans would be covered by the ongoing fees until the end of their individual terms. This should enable management within LEND or a rescue company.


More Topics

General Questions

Find out all about how we work, data protection, security and how to register with LEND.

Borrowers

Find out how to apply for a loan, how repayment works, what fees arise and what you need to bear in mind.