Lendermarket Review 2024: a Safe Platform with 12% Returns

Important update: Due to recent issues with late loans repayments & with withdrawing funds from the platform, I cannot recommend investing on this platform anymore. I contacted the platform about it and will update the review as I receive an answer from them. I left the review below for your reference.

I love to diversify my Peer-to-Peer lending investments on as many great platforms as possible, which is why I continuously review new platforms & share my experiences with those platforms on my site. In this article, I will review the Peer-to-Peer lending platform Lendermarket, which I added to my portfolio in 2021.

In the article, I will tell you what I think are the biggest strengths (and weaknesses) of the platform, how to start using it, and what you can expect from investing on the platform. Let's start!

What is Lendermarket?

As for all Peer-to-Peer lending platforms, Lendermarket is a financial platform that allows investors to invest in loans, in exchange for interests over time. Lendermarket was funded back in 2019, meaning it is a relatively new Peer-to-Peer lending company. They are based in Dublin, Ireland with offices in Estonia & Lithuania.

Compared to other platforms in the field, they really put the accent on the security of the investors money (which I will cover in details later), and on an excellent customer experience.

They have over 3,700 investors on the platform, and have funded over 27 millions Euros worth of loans on the platform. 

What returns can I expect from investing on Lendermarket?

The returns you can expect on Lendermarket depends on which projects you invest in, which I will tell you more about when we'll see how to use the platform. Currently, with projects listed on the platform you can get up to 13% annual yields, and they advertise an average annual return of 13.8% for investors since the platform launched. This is the top range of similar platforms, however I will need to verify this number with my own investments as most of the loans on the platform when I started to invest where more around 12% on average, which still makes it a top platform in terms of returns.

Is it safe to invest on Lendermarket?

The question of the safety of the investors funds is central when investing on a Peer-to-Peer lending platform, as they will be managing all the money that you deposit on the platform and invest it in loans. When reviewing a new platform before adding it to my portfolio, I look at three things: what the platforms offers in terms of guarantees, the company itself (and their team), and finally the source of the loans present on the platform.

Risks & guarantees on Lendermarket

As I mentioned earlier, Lendermarket puts an emphasis on security. The first thing they provide is a buyback guarantee on all loans, which is now pretty standard in the field. It means that even if the borrower doesn't pay back, you will be paid back by the loan originator that listed the loan on the platform.

However, this type of security also has weaknesses as well, as we could see during the COVID-19 crisis in 2020-2021, when some loan originators had difficulties to pay back buyback guarantees. This is why Lendermarket also offers what they call a group-level buyback guarantee, which is an extra layer of buyback guarantee offered by the parent entities of the lending companies.

The company & the team

As I mentioned earlier, the company is registered in Dublin, and as for all platforms I add to my portfolio I checked if the company was officially registered in this country, and it is indeed.

As for all platforms I invest on, I wanted to also check their team, especially people in key management roles. Whereas it was a bit difficult to find that information on their website, I quickly found what I needed on LinkedIn as they have a page their & list all the people that work for them.

For example, I checked the profile of the head of the company Endrik Eller, who has a great track record in the field as it worked for example for nearly 2 years at EstateGuru, another excellent crowdlending company that I have in my portfolio as well.

Projects originators

Lendermarket is also very transparent about their loan originators, and it was really easy to find that information on their website. 

They are mainly working with one loan originator called Creditstar - which is a major player in the consumer loans sector in Europe, being present in several countries. This means that you will have the possibility as an investor to diversify into many countries while investing in loans, as well as being covered by the group buyback guarantee I mentioned before.

Getting started with Lendermarket

It is actually really easy to get started with Lendermarket and have your money start generating rental income on the platform.

The first step is to open an account and get verified. This was done really quickly, and including the ID verification part it was all done in under 5 minutes.

Next, you will have to deposit funds in your account to start investing in loans and generate interests. This is also really to do with Lendermarket as you can do it via a bank transfer.

Once this is done, you can actually start investing in loans on the platform. For that, the first option is to check the loan listings:

From there, I could immediately see a large number of loans available in several countries, with interest rates ranging from 10 to 13%, and all covered by the buyback guarantee.

Whereas you can actually invest manually in every loan, the platform actually has a very easy to use auto-invest function. Here are the settings I used:

Once activated, this function will then just invest automatically for you according to the settings that you defined.

Note that for now the platform doesn't have a secondary market, but this is not an issue as there are a lot of loans available on the primary market.

As for all the platforms I review, I also tried to withdraw money, and the money was back on my account in just 1 day.

My Results so far with Lendermarket

I only started investing on Lendermarket in 2021 using the auto-invest function, and it should give me a returns of 12% annually on average. It is of course too early to talk about long-term yields on the platform, but I can say that so far everything went smoothly and I will definitely invest more on the platform in the future.