MoneyZen portfolio, 12 months

By the end of August I will have been investing into Moneyzen for a full year, so it was time to make a decision about the future plans for this part of my portfolio, especially since it’s currently competing against Estateguru in terms of contributions.



Changing strategies?

Moneyzen has, from the start, been struggling with growing their overall loan portfolio at a sustainable rate. Investors have a lot of free money to invest, but they just didn’t seem to be getting the market share that they wanted due to existing competition in Estonia.

Several of the people I know have been waiting for some sort of a fix for this, and I must say we waited for some kind of an announcement to come way earlier. So, this week Moneyzen announced that they are making their loans more easily accessible which is a recommendation that’s been on the front lines of many bloggers’ posts.

They have extended the deadline of loans from 5 years to 7 years making them stand out among other loan provides, and the maximum loan amount has been boosted from 5000 euros to 10000 euros, bringing them up to par with the same amounts that Bondora provides. It’s early to tell if that will make them take more of a market share, but the extended length of loan contracts might attract a different kind of clientele.

Status of my portfolio

When I started investing into Moneyzen my original plan was to add in 50€/month to create a smaller social lending portfolio with a different provider than Bondora, since Bondora was making up a significant part of my portfolio at that point. Soon, however, I realised that the 50€/month was not achievable due to a lack of loans.

Another issue with Moneyzen is that the IT developments haven’t caught up with their ambitions, meaning that the site causes a liquidity problem. You can’t have enough loans to causes meaningful cash flow (which you’d be able to transfer out if necessary) and there is no secondary market. The biggest problem by far though is the lack of overall statistics – a year into investing I’m still not able to tell you at a glance how much money I made in interest last month.


Therefore the decision for at least the second part of this year had to be made. This morning I transferred the last 25€ into Moneyzen for now, bringing the total transfers to 400€ euros, which means 2/3 of my original year’s goal, which I suppose isn’t terrible. (Neither is the close to 40€ interest earned off it.)

I’ll wait for more to happen, mostly:

– less cash drag

– an implemented secondary market

– a bigger market share

– better overall statistics

– recovery statistics (I have 2 defaulted loans)

All the best to Moneyzen, and I hope I have a reason to increase my investments for next year. For 2015 I’m done, I’ll just track how well the money moves, and I guess it can be a somewhat obscure emergency fund type thing that I might have access to at some point in the future.

MoneyZen portfolio, 10 months

I realised then titling this post that soon I will have been investing into Moneyzen for a year. The only thought that comes to mind with this – underwhelming. Moneyzen has greatly underperformed my expectations and if a secondary market existed at this point I’d likely make a full exit from the site.



Thoughts on Moneyzen’s current situation

Having invested into Moneyzen for 10 months now, I’m struggling to even fill my original goal of 50€ invested per month. I haven’t wanted to reduce the requirements I have for the loans I wish to invest into since their whole business plan was to have high quality borrowers. This means that while I’ve kept interests reasonable in my opinion then money has been moving slowly and I’ve had time when no loans have gone out for close to a month.

I’m not sure if it’s an issue with their business model or the way they select their clients. At this rate the lack of liquidity is becoming a bit of a liability since exiting the portal is a time consuming process. Also, I’ve now had two loans go into collections as well, which means that a sum close to the number of euros I’ve made in investments is now locked down.

Just overall I’m feeling very unimpressed and I can’t really figure out what the issue is. Is there truly a level of market saturation that they can’t break through? Is there a lack of clients that they’d like or is it just that at the interest point they are at people would prefer loans? Will the hoped expansion to Finland finally be the key? Whatever it is, then other portals are showing growth while Moneyzen is just not doing much of anything. I’m considering just stopping all investments at this point to not lock down more money and just see how it goes.