Limit on investments in loans by NEO Finance AB changed
In light of increased loan requests on the NEO Finance marketplace and seeking to fund them more rapidly, a decision was made to increase the limit on NEO Finance AB’s investments in loans effective 20 May 2022.
Until now, NEO Finance AB was able to finance up to 50% of the amounts of all loans listed on the platform. As the supply of loans grows and noting slower funding of loans on the marketplace, it was decided to increase NEO Finance’s AB investment limit to 80% of the original amount of the consumer credit. When the borrower has a credit rating of A+ or A, NEO Finance, AB can immediately grant a consumer credit up to EUR 15 000, and if the borrower has a credit rating of B, up to EUR 8 800, but not more than 80 percent of the initial amount of the consumer credit. NEO Finance, AB may deviate from the above maximum investment amounts and grant consumer credit to borrowers of all credit ratings if the investors have already financed at least 20 percent of the amount of consumer credit and at least 24 hours have passed after the application for consumer credit has been submitted to the market.
NEO Finance AB will be able to invest in loans rated C or C- only when other investors finance at least 20% of the loan amount and at least 48 hours from the date of the borrower's application for consumer credit to the market period has passed. These changes will help put investors’ money to work faster and speed up the funding of loans.
“The amount of loans financed via the platform has been growing sharply in recent months, and since investors have a bigger choice on the marketplace, some loans are getting funded more slowly. In response to this situation, we take steps to ensure a good borrower experience and more efficient handling of their applications. This is a win-win solution – investors’ money will be put to work faster and borrowers will get their loan faster. This will give for the platform an even greater advantage in the market, attracting more borrowers and offering investors more investment opportunities,” notes Indrė Krasovskė, who heads the team at the platform.
As until now, when a loan is funded by NEO Finance AB, that can be seen on the marketplace beside the loan’s listing date. Loans financed by NEO Finance AB are marked with the company’s logo.