Esketit Review

Esketit Review

Esketit is a newly launched P2P lending platform owned by the multinational lending company CreamFinance. Currently, you can invest in loans from Jordan, the Czech Republic, Poland, or Spain with an average annual return of 13.37%. Is Esketit worth your investment? Find out in our in-depth Esketit review.

Risk and Return

Investing in loans is risky, and you might lose your money. Esketit offers a 60-day buyback obligation for all its loans.

Loans from lending companies in the Czech Republic, Poland, and Spain come with an additional group guarantee.

The availability of loans is subject to market conditions. Most of the listed loans on Esketit are issued in Jordan.

Buyback Obligation & Group Guarantee

The buyback obligation represents the promise of the lending company to repurchase your loan after the borrower has delayed repayment for more than 60 days.

The group guarantee represents the financial group's promise to fulfill the lending company's obligation in cases where the lender cannot cover the buyback obligation.

Keep in mind that the group guarantee does not affect all loans on Esketit and that Creamfinance only offers a group guarantee for its lenders. The lending company in Jordan is not part of the Creamfinance group, but the same owners own them.

The buyback obligation and the group guarantee are directly related to the financial situation of the lenders or the finance group.

Let’s look at some of the reports from Creamfinance Holding Ltd.

It’s worth noting that BDO audits all the reports in Cyprus, where Creamfinance Holding is legally based.

Creamfinance’s Portfolio

Creamfinance also funds its loan book from another crowdfunding platform in Japan. The company lists loans from its lenders from Latvia, Poland, and Spain.

During our talk at Creamfinance's headquarters in Riga, we learned that Spain is undoubtedly a challenging market for Creamfinance. However, the lender sees good potential in Spain, so it will put more effort into improving its portfolio quality in this market. 

What's important to highlight is how CreamFinance handles its portfolio quality. The company sells bad portfolios to collection agencies in most European countries at a 50% discount.

The default rate of the lender's portfolio in established markets is typically below 10%. If we assume that 10% of the loans default, and the company sells the bad loans with a 50% discount, the net loss is around 5% from the loan book covered by the lender’s profits.

Selling bad-performing loans is a standard process in the lending industry. It helps to keep the portfolio healthy.

Investing in Jordan

Jordan is an attractive market with interesting returns for P2P investors. Esketit currently offers 14% interest on investments in loans from Jordan. Let's have a closer look at this market.

On Esketit, you can invest in unsecured consumer loans from the lender Money for Finance, which the founders of Creamfinance and Esketit own.

The lending company is issuing loans to new borrowers of up to €130, and repeated borrowers can get up to €240 for 30 days. It's worth pointing out that more than half of the borrowers extend the loan repayment period.

Money For Finance has been operating on the market for one and a half years and has built a portfolio of €10 M.

The default rates in Jordan are lower than in some European markets, where Creamfinance has been operating for years. This is due to the strict payment morals in the country.

Jordan is, without a doubt, an emerging market that always comes with certain risks. The company follows the Ministry of Industry and Trade rules, and it doesn't need a lending license to issue loans in the country. Most of the loans are issued in cash to borrowers with regular income. The effective APR charged to borrowers is around 200%.

Regarding the country's risk, there is no currency fluctuation as the Jordanian dinar is pegged to the US dollar. Currently, there is no elevated political risk, and the lender expects some regulation within 2 to 3 years.

While investing in Jordan isn't risk-free, it can certainly be an attractive opportunity for many P2P investors to increase their return from P2P lending.

Direct investment in Money for Finance

Esketit started offering the possibility to invest directly into the development of the lending company Money for Finance in Jordan via a business loan channeled through MD Investments SIA in Latvia, which owns the lending originator in Jordan. You can find this investment on Esketit's primary market.

Additional Information: Audited Financial of Money for Finance in Jordan

The lending company Money for Finance has generated a loss in 2021, which has been covered by increased capital share from the board of directors. The loan portfolio of the loan originator is profitable monthly. The company is experiencing a default rate of only 5%.

Is Esketit Safe?

Investing on newly launched platforms with no track record is always riskier than joining more established platforms. Esketit’s business model is similar to Robocash, PeerBerry, or Afranga.

The platform funds loans within the financial group to which it belongs. Let’s have a closer look at the people behind Esketit and Creamfinance.

Get insights about the Esketit operation here:

Who Leads the Team?

Vitālijs Zalovs is the CEO of Esketit and, therefore in charge of the platform's operations. He has previous experience working at Mintos.

Get to know him better in our latest interview where we discuss the latest developments and future plans for 2023:

Who Owns the Platform?

Esketit is owned by the co-founders of the Creamfinance Group, Davis Barons, and Matiss Ansviesulis. Both gentlemen have an impressive track record of growing their companies.

Are There Any Suspicious Terms and Conditions?

When using a P2P lending platform, you should always review the terms and conditions to ensure you know your rights and obligations.

Storage of Funds

Using Esketit, you will have to send your funds to Esketit’s bank account. The platform doesn’t provide you with individual IBAN accounts. According to the T&C’s, your funds on Esketit are stored separately from the platform's funds.

Amendments

Esketit reserves the right to amend the terms and conditions at any time. The platform will inform you about any changes via email; however, it does not state the time frame you have to accept or decline those amendments.

Access to Loan and Assignment Agreements

The assignment agreement is not available for unregistered users; however, if you sign up, you can review a sample of that agreement by navigating to it on the primary market.

What’s our Opinion of Esketit?

As we write this Esketit review, there are currently only loans available from the Czech Republic, Poland, Jordan, and Spain.

We suggest you check the loan availability before you sign up and invest in getting an idea about the diversification options on Esketit. Note that if you don't see any open investments on Esketit's home page, it doesn't mean there is cash drag. As of January 2023 most of the uninvested funds are being invested within 24 hours. 

We do not like that the site makes it appear like it's being operated from Ireland, while by using the platform, you agree to the terms and conditions of the Latvian Esketit company. The bank account to which you deposit your money is based in Switzerland, as Esketit's bank account in Latvia has been recently closed.

While Creamfinance is a well-established player in the global lending market, keep in mind the countless risks associated with investing in unsecured loans.

Regulatory changes might lead to losses for the company, which may negatively impact the performance of your portfolio.

If you join Esketit, you should understand the lender’s loan performance in dedicated markets.

During our visit to Esketit, we chatted with the CEO, the two founders, and the team in charge of the operations in Jordan.

We gathered in-depth information about the lending business in Jordan, which convinced us to expose our portfolio on Esketit.

We are currently investing in all short-term loans on Esktit that come with the instant exit option. Note that you must use pre-defined investment strategies to benefit from the increased liquidity. Our experience with Esketit has been exceptional so far.

We earn 14% per year by investing in well-performing loans from Jordan. Keen to join as well?

Usability

In terms of usability, Esketit provides an Auto Invest feature, saving you some time when investing on this platform.

Auto Invest

The Auto Invest feature allows you to define essential loan characteristics such as the loan amount, interest rate, remaining loan term, countries, loan types, or loan originators.

Remember that only Esketit's automated strategies offer "instant cash-out" during normal market conditions. If you decide to invest in loans through a custom Auto Invest strategy, you will have to use the secondary market to sell your investment.

If you have invested on other P2P lending sites before, investing on Esketit will be very straightforward. The platform also allows you to invest in the primary or secondary market. We prefer, however, to use Esketit's automated investment strategies.

Keep in mind that the diversification, as well as the loan availability, is limited on Esketit.

Liquidity

Esketit does provide a secondary market that increases the liquidity of your investments. We have not tested it, so we cannot comment on the time it takes to sell your investments.

The secondary market allows discounts that should help you sell your investments faster.

As we conduct our Esketit review, there are plenty of loans on the secondary market with a discount of 20%. If you feel like taking the risk and investing in loans from Jordan backed by a buyback guarantee, Esketit’s secondary market is the place to go.

Esketit Automated Strategies & Instant Exit

Esketit offers three automated pre-defined investment strategies that help you diversify your portfolio with just one click.

• The Diversified strategy allows you to distribute your investments to all available loan originators (33% in Jordan loans, 67% in Creamfinance loans).
• The Jordan strategy allocates your investments only into loans from Jordan.
• The CreamFinance strategy diversifies your investments across lenders that belong to the CreamFinance Group and offer the group guarantee.

The distribution of investments in Creamfinance loans under the Diversified strategy is based on market availability. This means that your investments in loans from Spain, Poland, and the Czech Republic won't be distributed equally.

All three strategies offer an instant exit option. You can create a strategy, click on “edit,” and use the “cash-out” option to withdraw your funds, should you need it.

Remember that the “cash-out” option is meant to work mainly during normal market conditions. Other investors will have the same strategy activated for the feature to work. So, other investors will take over your loan investments when starting the “cash-out” option.

Esketit Review Summary

Our experience with Esketit has been excellent so far. The platform is owned and run by the experienced founders of Creamfinance. Esketit offers up to 14% interest and a reliable buyback guarantee backs your loans.

Main Takeaways From Our Esketit Review:

• 60-day buyback obligation
• Higher interest rates
• Operating from Latvia
• Limited diversification

If you believe Esketit is a good fit for you, sign up with our link to get a 1% cashback bonus.

Ready to let your money work for you?