Mintos is the largest P2P lending platform in Europe. More than half a million investors have signed up on the platform and more than €8 B in loans have already been funded since its inception in 2014. Therefore, the marketplace enjoys a special status in the P2P environment.
As impressive as these numbers are, Mintos had also faced many stress tests and struggles in recent years, which have clearly exposed the platform’s weaknesses. In this Mintos review you will find out about the risks that come along with investing on the biggest P2P marketplace in Europe and whether an investment is worthwhile.
All the information that are covered in this Mintos review are based on my own personal experiences with the platform for the past 5+ years. Please make sure to do your own due diligence before investing on any platform. More information can be found in the Disclaimer.
Further analyses of other platforms can be found on my P2P Platform Review page.
Last Update: September 2023
Before we get started, here is a quick summary with the most important information about Mintos.
|Founded / Started:||May 2014 / January 2015|
|Legal Name:||AS Mintos Marketplace (LINK)|
|Regulated:||Yes (Financial and Capital Market Commission)|
|CEO:||Martins Sulte (May 2014)|
|Community Voting 2022:||2.95 out of 5 | See Voting|
|Financed Loan Volume:||€9.2+ B|
|Number of Investors:||525.000|
|Primary Loan Type:||Consumer Loans|
|Bonus:||50 Euro (€1.000 Investment)|
Due to its highly scalable business model, Mintos is the largest P2P platform in Europe in terms of financed loan volume.
The vision of the platform is that investing into loans will become a mainstream asset-class, while Mintos aims to be the world’s leading P2P marketplace.
The Origin Story
Martins Sulte, one of the founders and CEO of Mintos, was in the final stages of his MBA studies in 2014. At the time he wrote down some ideas about what he could do after graduation.
With his experience in the financial sector (Ernst & Young, later investment banker at SEA) and his natural interest in technology, he wanted to combine both of his passions.
After reading an article about the British platform Landbay on TechCrunch, he became aware of the P2P lending business model. Together with Martins Valters, who had previously been his direct supervisor at Ernst & Young, the two founded the company Mintos in 2014.
Who owns Mintos?
The question of who owns Mintos has always been popular as well as controversial. On the “About Us” page it says that besides the two founders Martins Sulte and Martins Valters, four other investors have been involved in the set-up of Mintos.
These are: Maris Keiss (co-founder of 4finance and Mogo), Aigars Kesenfelds (co-founder of 4finance and Mogo, investor in Artsy and Madara Cosmetics), Kristaps Ozols (co-founder of 4finance and Mogo ) and Alberts Pole (co-founder of 4finance and Mogo).
The ultimate beneficiary owner of AS Mintos Holding is Aigars Kesenfelds, who owns at least 25% of the company according to IFRS standard. The exact shareholder breakdown is not revealed by Mintos.
AS Mintos Holding is in turn owned by AS ALPS Investments. Also here, Aigars Kesenfelds is the ultimate beneficiary owner.
Aigars Kesenfelds is often considered the secret string-puller behind Mintos. The Latvian multimillionaire, who was one of the four founders of 4finance in 2008, vappears very rarely in public. However, his reputation precedes him by a long way.
An extensively researched article by a Re:Baltica journalist “The Fast Millionaire” portrays the rise and background of Aigars Kensenfelds empire and also showcases his cross connections to Mintos.
Mintos is represented by CEO and co-founder Martins Sulte and by co-founder and COO/CFO Martins Valters.
Business Model & Finances
Throughout the process of due diligence, investors should also have a look at the business model of a P2P platform as well as the overall financial situation. How does the company earn money? Does the platform operate profitably? And how well is the company positioned financially? In the following paragraphs of this Mintos review, you can follow-up on those questions.
How does Mintos earn money?
Mintos generated a revenue of € 8.21M in 2022. This revenue is divided into five different sources.
- ServiceFees for Lenders: € 8.2M (89.4%)
- Inactivity Fee for Investors: € 336,000 (3.7%)
- One-Off transaction Fees: 293,000 (3.2%)
- Currency Exchange Commissions: 191,000 (2.1%)
- Transaction Fees Secondary Market: 151,000 (1.6%)
The inactivity fee for investors was introduced on 3 January 2022. Investors will be charged a monthly fee of € 2.90 if they do not invest in any new loans or sell any loans from the portfolio for six months. Mintos was thus able to generate a revenue of € 336,000 in its first year, which corresponds to the marketplace’s second-highest source of income in 2022.
Is Mintos profitable?
After four consecutive years, some with very significant losses, Mintos was able to generate a profit again in 2022. The consolidated report shows a profit of € 220,000. Because the portfolio under management decreased by around 30% and therefore the revenue also fell by just under 10%, the profitability at Mintos is primarily explained by massive cost savings. Among other things, many employees were laid off, which led to savings of about € 1.2M.
The balance sheet of Mintos, on the other hand, is quite respectable.
KPIs such as the equity ratio (64%), the liquidity ratio (1.78) or the debt-to-equity ratio (0.58) are all in a good range. Only the historically high number for intangible assets should be viewed critically.
Sign Up and Bonus
In order to invest on Mintos, investors must meet two important requirements: A minimum age of 18 years and proof of a European bank account in their own name.
The registration process on Mintos is very simple and intuitive. After opening an account via email, the KYC and AML questionnaires must be filled out. This is followed by the verification of identity and the declaration of tax residence.
Bonus for New Investors
If you register on Mintos via this link, you will receive a 50 EUR bonus. This requires that you invest at least 1,000 EUR.
Investing on Mintos
How does Mintos work and what should investors know and consider when investing on the marketplace? In the following sections of my Mintos review you will find all the necessary information that you need.
Loan Offering on Mintos
The 80+ lenders represented on Mintos offer a variety of different loan types. These include:
- Private: Consumer Loans, payday loans, car loans
- Corporate: Business loans, agricultural and factoring loans
- Real Estate: Mortgage loans.
Currently, investors can invest in loans from 33 different countries. The geographic focus is in Europe, with a strong concentration on the Baltics, the Balkans and Eastern Europe.
But there is also the possibility to invest in Africa (South Africa, Zambia, Namibia, Botswana, Kenya), South America (Colombia, Mexico) or Southeast Asia (Philippines, Vietnam, Indonesia).
Costs and Fees
The registration on Mintos is free as well as the usage of the primary and secondary market (as a buyer). No costs or hidden fees apply for investors. Also deposits or withdrawals can be done free of charge.
The only costs that apply are in form of transaction fees when selling loans through the secondary market. This fee is 0.85% and was introduced on April 13, 2020.
Expected Returns on Mintos
According to Mintos, the net return on the platform is between 10% and 12%. The calculation is made including an annual loss ratio. For this reason, the return on investment in 2020 is only at 2%.
Write-downs were taken on loans issued by suspended credit entities based on our recovery estimates.
Afer being five years with Mintos, my personal return is at 10.79%. However, there are still more than €1,000 in the recovery process, which I declared as a loss since no recoveries have been made for two straight years. As a result, my total return has dropped to 7.22%.
Investors on Mintos can take advantage by using the Auto Invest, which means that the returns can be automatically reinvested. With the Mintos Auto Invest, the following settings, among others, can be configured:
- Selection of lenders and borrower countries
- Loan type (Personal, Corporate, Real Estate)
- Buyback guarantee (Yes, No)
- Interest rate: From 5% to 30+% percent
- Loan term: Up to 72 months
- Investment amount per loan
After becoming a regulated marketplace, Mintos is now packaging similar loans into a financial instrument (Notes). The minimum investment amount for a Note is €50 and can consist of up to 12 individual loans.
Also the secondary market can be used to invest in loans. The purchase itself comes without any fees. However, a fee of 0.85% applies when selling through the secondary market. A premium or discount can be selected as well.
If you have questions about Mintos, other platforms or different p2p-related topics, you can join the re:think P2P Community on Facebook and engage in discussions with more than 1,000 other private retail investors.
After Mintos has become a licensed brokerage company, the platform is now legally obligated to withhold taxes on your income earnings that derives from investments into regulated financial instruments (Notes). The tax will be automatically withhold after receiving an interest payment.
The applicable tax rate is depending on the country of your tax residency and according to the submitted tax information and certificates.
- 20% for private investors and tax residents of Latvia
- 20% for investors from outside the EU/EEA
- 5% for private investors with residency in the EU/EEA (except for Latvia)
- 0% for Lithuanian tax residents (tax certificate is required)
- 0% for legal entities
Mintos faced several crises and problems in the past. While the origins of these crises are not related to Mintos (Covid-19 pandemic, war in Ukraine), they have clearly exposed the problems at Mintos.
Escpecially in 2020, there have been numerous actions and entanglements that have not painted a good picture with regards to the integrity of the platform.
Conflicts of Interest
At the shareholder level, Mintos has always had strong overlaps with many of its lender companies. While this can be an advantage in terms of communication and possible settlements, there is also the risk that decisions primarily serve the interest of shareholders and only secondarily of the investors.
Disintegration of Finko Group
Early 2020, Finko Group had an outstanding portfolio of approximately €100 M. At the time it was the largest non-bank lender on Mintos. The year before, the Finko group, which funded seven lender portfolios on Mintos, financed € 366 M in consumer loans while generating a profit of €17.6 M.
Only a year later, there is nothing more left of the group except an empty shell. Some lenders have had their licenses revoked under dubious circumstances (Varks in Armenia), others have filed for bankruptcy (Metrokredit and Kiva from Russia) or have been sold for a ridiculous price to competitors with the same shareholders (Sebo from Moldova), which in the end left no funds available to meet the buyback guarantee which was advertised to investors in advance.
Collapse of Varks
Armenian lender Varks has been the largest lender within the Finko Group with €30 M on Mintos at the time of the license withdrawal in March 2020. On the blog I wrote about the dubious circumstances of the license withdrawal as well as the the promotional activities which were run prior to it by Mintos to advertise loans from Varks (including forward flows and cashback campaigns). This happened despite obvious problems on the part of the Central Bank of Armenia with the lender.
Also the entanglements between the shareholders and the broken debt clauses between Varks and Mintos were already a topic on this blog.
In the case of Varks, Mintos was well aware of the lender’s financial situation and problems with the central bank. Yet, no measures were taken or initiated to protect investors. In the end, it was publicly communicated that a two-year repayment plan until the end of 2022 was agreed upon. Unsurprisingly, no funds have been returned to investors to date.
Corona Crisis / Covid-19 Pandemic
Mintos responded fairly fast to the spread of the Corona pandemic. As a consequence, both strategic and operational measures have been adjusted. In the first “Ask Mintos Anything” session on 19.03.2020, Mintos CEO Martins Sulte announced the following actions, among others:
- Focus on financial stabilization and consolidation of the platform
- Cost reduction of approx. 40 percent
- Layoff of 45 employees (140 employees have been newly hired in 2019)
- Downsizing of marketing budgets (e.g. no cashback bonus for new investors)
At the time of the session, the company had €3.6 M in cash available, which would allow the platform to continue its business operations as usual over the next 15 to 18 months given its current cost structure.
Two measures that have been integrated on Mintos seemed to be very questionable though.
The Schedule Extension
In October 2019, Mintos introduced a schedule extension for the first time. What had been a good and understandable idea at its core (no repurchase of loans once the loan term is extended) soon became an excuses to allow lenders to maximize liquidity from investors funds.
The schedule extension was increased over the course to up to 6 intervals of 31 days each. Later on, it was also introduced that already defaulted loans can be further postponed. Not only did Mintos violate its own user agreements with these actions, they also worked more in favor of (affiliaed) lenders interest than for the interests of the investors.
Did Mintos cross a red line with the loan extension? Find out more in this (German) article.
New Terms & Conditions
The introduction of new terms and conditions in August 2020 was no less controversial. What was sold to investors as an update regarding “Mintos Strategies” included nothing less than the participation in legal costs as soon as the lenders (acquired by Mintos) are no longer able or willing to make loan repayments.
This means basically a liability shift from Mintos to the investor and a free ride for the platform.
War in Ukraine
The war in Ukraine has also had a significant impact on Mintos investors. After Russia invaded Ukraine on February 24, Mintos suspended all new investments on the primary market for Russian or Ukrainian loans. In total, eight lenders are affected by these restrictions (Creditter, DoZarplati, EcoFinance, Kviku, Lime, Mikro Kapital, Mokka and SOSCREDIT).
Mintos has taken the following actions in response:
- All Russian and Ukrainian lending companies have been removed from Mintos strategies
- No currency exchange from and to Russian rubles, valid for all currencies
- Loans from Russia and Ukraine can still be bought and sold via Mintos secondary market
- Russian and Ukrainian loans from Mintos strategies are not available for standard payout. Liquidity can only be achieved by selling on the secondary market.
Funds in Recovery
As of early 2023, the Mintos portfolio under management reached a level of €652 M. Of this portfolio, roughly 40% are either delayed, in pending payments or in the recovery process. In conclusion, only 60% of the entire loan book perform as expected. Those are some questionable numbers compared to other platforms and competitors.
In total, more than €155 M are currently in the recovery status.
Pros & Cons
In this section I have listed the biggest advantages and disadvantages of Mintos.
- Track Record: With 7+ years of market experience, Mintos is now one of the more established platforms in the P2P environment.
- Regulation: Since 2022, Mintos has been under the supervision of the Financial and Capital Market Commission (FCMC) in Latvia, being a regulated and licensed brokerage platform.
- Growth Potential: The highly scalable business model enables Mintos to grow significantly faster and gain market shares compared to other platforms.
- Transparency: Mintos publishes regular updates on business developments as well as audited annual reports.
- Bad Due Diligence: The Covid-19 pandemic exposed many of the company’s weaknesses. This includes primarely the unsufficient due diligence of its lending companies.
- Conflicts of Interest: Mintos has shareholder overlaps with many of its lenders, creating dependencies and conflicts of interest.
- Questionable Measures: As a result of the conflicts of interest, numerous measures have been introduced in the past that have had a detrimental effect on the interests of investors.
- Financials: In each of the last four years, Mintos accumulated a bigger loss compared to the previous year.
In terms of its business model, Mintos is most comparable to P2P marketplaces such as PeerBerry or Income Marketplace. The biggest difference between the marketplaces is that PeerBerry is backed by a large and established non-bank lender from Europe (Aventus Group), which primarily offers its own loans on the marketplace.
You can find other Mintos alternatives on the P2P Platform Comparison page.
Mintos Community Feedback
The Mintos reviews within the P2P lending community are rated fairly average. In the Community Voting 2023, a score of 2.95 was achieved out of 121 votes. In the years before, the score was 2.61 (2022) and 3.22 (2021).
Mintos Review Summary
Mintos is the largest marketplace for P2P loans in Europe. The platform achieved this status due to a high scalability of its business model while operating in an unregulated environment for many years. This gave the platform a crucial edge over many competitors in Europe.
Although many investors were able to generate decent returns in the first few years of the platform, the downsides of Mintos came to light with the erruption of macroeconomic events such as the pandemic or the war in Ukraine. The marketplace had done insufficient due diligence on many lending companies.
As a result, €150+ M of funded loans are now being in the recovery process. Mintos itself is already forecasting a loss of at least €64 M.
A big reason for concern should be how Mintos was handling actions at the time of 2020. Severeal measures have showcased that shareholder interests of affiliated lending companies are prioritized over investor interest.
This leads to the conclusion that Mintos was not just able to protect investors funds properly in many cases, but also that the moral integrities of the company as a whole have to be questioned.
We believe that beginners are better suited to focus their attention on other platforms such as Esketit, Income or PeerBerry. If investors want to take advantage of the broad loan offering on Mintos, it would be advised to fully understand the underlying risks of investing on Mintos. The ability to evaluate the performance of individual lending companies is crucial to earn decent returns on Mintos as a diversified approach will not get the job done.
FAQ Mintos Review
Mintos is a Latvian P2P marketplace, founded in 2014, where investors can invest in a variety of loans from global lenders and earn a return of around 12 percent. Due to its highly scalable business model, Mintos is currently the largest P2P platform in Europe in terms of the funded loan volume.
The beneficiary owner of AS Mintos Holding is Aigars Kesenfelds, who thus owns at least 25+ percent of the company according to IFRS standard. AS Mintos Holding is in turn owned by AS ALPS Investments. Also here, Aigars Kesenfelds is the ultimate beneficiary. Mintos does not disclose an exact breakdown of the ownership structure.
Mintos earns money through five different revenue streams: Service fees from lenders, inactivity fees from investors, one-time transaction fees from lenders, commissions on foreign currency exchanges and fees on secondary market transactions. Through these five pillars, Mintos was able to generate revenue of €9.1 M in 2022.
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