Hey everyone, it's Marco. In this article, I will share with you an interview I recently conducted with Darius Noreika, the CEO of FinBee, a peer-to-peer lending platform that I recently started to invest in. FinBee was founded in 2015 and has been gaining traction recently, which piqued my interest and led me to reach out to Darius to learn more about the platform.

Introduction to FinBee

Darius Noreika, thank you for joining us for this interview. Could you please introduce yourself and tell us a bit about FinBee?

FinBee is a peer-to-peer lending platform for consumers and businesses. We launched in Lithuania in 2015, so we have been in the market for nearly a decade. We operate exclusively in Lithuania, which is a unique market with high data quality for credit underwriting. Interest rates are relatively high due to significant bank concentration, and creditor protection is robust, resulting in good collection outcomes. This creates an opportunity for investors to earn double-digit returns with manageable risks.

Regarding myself, I am a co-founder and CEO of FinBee. Before FinBee, I worked at Scandinavian banks for eight years, focusing on credit risk and financial analysis. I leveraged my banking experience to create FinBee and have been with the company since its inception. Initially, I served as the Chief Operating Officer, handling credit risks, IT, financial management, and operations. In October 2019, I took over as CEO and have been successfully running the company since then.

What Sets FinBee Apart

What makes FinBee different from other peer-to-peer lending platforms?

There are three main differences. First, we are a fully regulated peer-to-peer lending platform from day one. We hold three licenses: a peer-to-peer consumer lending license, a crowdfunding license for SME lending, and an electronic money institution license for facilitating payments. This regulatory framework creates a safe environment for investors.

Second, we operate in a market with high interest rates but good credit protection, resulting in a strong portfolio performance. Lastly, we have a proven track record, having operated profitably since 2018. This longevity and profitability are rare in the fintech space.

The Appeal of Peer-to-Peer Lending

Why is peer-to-peer lending an attractive investment option compared to other asset classes?

Peer-to-peer lending with FinBee offers high returns, often higher than long-term stock returns, with relatively low risk. Unlike stocks, there are no price fluctuations, providing stable and high returns. Additionally, investors can start with very small amounts, as low as 5 euros, making it accessible. Monthly interest payments allow for easy reinvestment, maximizing the compounded interest effect over the long term.

Regulation in the Peer-to-Peer Lending Space

Can you elaborate on FinBee's regulatory status and future plans in this area?

We already hold the European crowdfunding provider license, which regulates our SME lending business. Transitioning from national to European regulation was straightforward for us, as the rules are quite similar. This regulation hasn't significantly changed our operations but ensures compliance and security for our investors.

The Future of Peer-to-Peer Lending

What do you see for the future of peer-to-peer lending, especially in terms of returns, safety, and the number of platforms?

In markets like the US and UK, the largest platforms are transforming into banks to access cheaper funding through deposits. However, in Lithuania, the market size makes this model less feasible. Instead, we see value in diversified funding sources, combining retail and institutional funding to grow our loan book faster. We might also see new investment products similar to Bondora's Go and Grow, although regulatory challenges could arise.

Ensuring Investor Security

How does FinBee ensure the security of investors' funds?

In Lithuania, peer-to-peer lending platforms cannot touch investors' money directly. We use a licensed electronic money institution to handle funds, ensuring a secure environment. This model provides the best security for investors, as their money is managed by a regulated entity.

Future Plans for FinBee

What are FinBee's plans for the future?

We are focusing on both compliance and user experience. We are investing in compliance, personal data security, and cyber security to meet regulatory requirements. On the user side, we aim to automate and streamline processes for faster and easier onboarding. We are also improving platform performance to handle growing data sizes and enhance user experience.

Advice for New Investors

What advice would you give to someone new to peer-to-peer lending?

First, conduct due diligence on the platform to avoid fraud. Check the platform's regulation, market, and team. Once you are confident, automate your investments and diversify your portfolio. Peer-to-peer lending is a great way to invest passively and benefit from compounded interest over the long term.

Getting Started with FinBee

How can someone learn more about FinBee?

The best way is to visit our website, finbee.com. We provide extensive data, including public quarterly reports and detailed loan books for registered investors. This information allows potential investors to analyze our performance and make informed decisions.

Thank you for joining us for this interview, Darius. We appreciate your insights and look forward to seeing FinBee's continued success.