You’ve probably heard about Fairmoney a lot of the time.
But as a loan app.
Yes, Fairmoney is one of the most popular loan apps in Nigeria. They give short-term payday loans that last from weeks to 6 months.
They’ve been around for a while and they are doing quite well in providing access to quick loans for low income individuals and SMEs.
Now, Fairmoney is branching up to incorporate crowdfunding to their business model.
Individuals are now encouraged to invest in Fairmoney and get a piece of the loan-interest pie accrued by the company yearly.
Let’s take a deeper look at this opportunity.
What Is Fairmoney Investment All About?
I think Fairmoney is trying to have a larger pool of funds to be able to give out more loans and maybe help more SMEs.
The company has a plan to provide more business loans than personal loans, as they have proven to be more performing.
So, with the help of a crowdfunding pool, the company could achieve its business interests while helping SMEs and Investors make more money.
How Does Fairmoney Make Money?
The business model employed by Fairmoney is quite clear.
They provide short-term loans and receive interest in return. Their interest rates could range from 20% to 60% depending on the loan tenure.
In other words, Fairmoney uses money to make money. I think that’s fair enough.
How to Invest in Fairmoney
To invest in Fairmoney as a private investor, you have to contact the company directly via their phone numbers and other communication channels.
The minimum investment amount is 100,000 Naira, so obviously, Fairmoney Investment isn’t for everyone.
You have to be ready to trust Fairmoney with at least 100k to get a return of 21k after 12 months.
How Much ROI Does Fairmoney Investment Offer?
A whopping 21% return on investment.
I think so far, no company in Nigeria gives you a 21% ROI without any risk.
Fairmoney on the other hand is guaranteeing a fixed income return of 21% after 12 months.
Is Fairmoney Investment Legit?
The company is deemed legit after building a solid reputation over the last 3 years.
Fairmoney is considered one of the top 3 loantech companies in Nigeria.
In fact, earlier this year, Fairmoney raised a Series B funding of $42 million from global institutional investors.
If these global investors could trust the legitimacy of Fairmoney’s business, why shouldn’t you?
Can You Lose Money With Fairmoney?
It doesn’t seem likely.
The Fairmoney investment proposition comes as a safety net investment that gives investors a guarantee of 21% ROI.
Even though the company is risking the money by providing short-term loans, they have proven that their business model works.
Hence, despite the risk of default with short-term loans to low income individuals and SMEs, Fairmoney has been profitable for the past 3 years.
So, losing money while investing with Fairmoney is less likely to happen.
Should You Invest in Fairmoney?
You should if you are okay with having your money sitting down for 12 whole months.
I am guessing the yearly tenure of the Fairmoney investment is a strict one, unlike that of Branch which is a liquid Investment.
So, you might incur some liquidation charges if you try to withdraw your investment before the 12-month investment tenure.
Branch offers 20% annual ROI with no obligation and you could withdraw your money at any time.
This is in contrast with the Fairmoney investment proposition.
So, you have to make an investment decision. 21% APY rigid or 20% APY liquid.
The choice is yours.