Social lending has been around for a number of years now and if you are seeking new avenues of growing your money in Japan, it could be one option you want to look at.
There are, of course, several options available and among them, the more popular ones appear to be OwnersBook by Loadstar Capital, and Crowdcredit by Crowdcredit.
Personally, the name Loadstar Capital sounds like some dubious Cayman Island-registered business. However, the company is listed on the Mothers (Market of the high-growth and emerging stocks) section of the Tokyo Stock Exchange, which means they would’ve been thoroughly checked before becoming public. OwnersBook mainly deals with domestic real estate funding and its published returns are fairly low, at about 4-5% but the benefit of it is that if the properties are sold off before the loan period is up, returns can increase to about 14-15%. Investment period typically ranges between 9 months and 3 years. I haven’t used OwnersBook myself but according to information from bloggers who are investing on the platform, the returns are typically paid out once every quarter, so you get about 1% of your investment each payout period. The other benefit about OwnersBook is that, the minimum investment sum is 10,000 yen (about SGD$120), which makes it easy for anyone to make the jump and give it a shot. But I’ll need to read up a bit more before deciding if it’s for me.
The other platform, Crowdcredit, is a very different social lending platform in that it specializes in foreign loans mainly in Eastern Europe, the Baltic States, Cameroon, Peru, and Russia, and the company has announced plans to expand its loans to North America and Australia to cover all continents. While the company is not listed as yet, it has grown rapidly largely due to the reputation of its backer, Itochu Corporation, one of Japan’s largest trading companies. Like OwnersBook, Crowdcredit accepts a minimum investment of 10,000 yen and offers returns of between 4-12%. Investment periods are typically 7 months, 13 months, or 3 years. However, the Baltic States vehicle lease funding can range from 6 months to 66 months depending on the actual loan your funds are being used on. As the company deals with foreign loans, many are funded in such foreign currencies as USD, EUR and RUB. However, some of these funds offer currency hedging, which is a good option for people who are willing to lower their returns for peace of mind off the volatile FX market. The company also provides the status of each fund’s performance once a month on their site, so if you are the uptight kind, you don’t have to sit at home wondering how your investment is doing.
And because I don’t want to let my money sit in the bank anymore, I tried searching for similar platforms in Singapore and found MoolahSense. While I haven’t done enough research into it, it seems that there isn’t as ample information on the funds available as the platforms in Japan. And the minimum investment sum of SGD$1,000 may be a bigger hurdle to cross than the platforms here. I’ll have to read up more on it but if you have information on MoolahSense, please share your experience, insights or opinions.
Interesting, since you are on this topic about money growing and investing thingy, what are you thoughts on the bitcoin situation in Japan? Recently straits times keep spamming bitcoin news (about how it’s soaring above xx$). I heard Japan had recently made bitcoin a legal currency and accounts for almost half of bitcoin trading in the world. For me personally i do not dare to invest in bitcoin because i fear that it is a bubble and may burst soon (like the dotcom crisis in the early 90s-
2000s)
Japan has been the land for the largest bitcoin tradings since around 2013 when the now-defunct Mt. Gox was handling over 70% of all bitcoin transactions worldwide, which later saw millions of dollars worth of bitcoins go missing. Nevertheless, Bitcoin is actually accepted for purchases at Bic Camera, one of the largest consumer electronics retailer chain here, and like you said, has been recognized as legal tender. So I guess you can say Japan is the leading nation in the adoption of cryptocurrency. I’m not sure if you can make payments on their online store though but Steam (by Valve) has recently stopped accepting bitcoin payments because of the volatility, where a failed payment leads to a rollback and then when the user tries to purchase again, the amount of bitcoins required for the same item changes. However, the company has not completely stepped away from the cryptocurrency and indicated their intention to accept it again when prices become more stable. This means there is potential for it to be more and more widely used.
I’m no expert in investment as I am just learning as I go along, and I’m not much of a risk taker so I decide what my risk appetite is, get into the game and am prepared to lose the money. While the price has gone haywire at over SGD$20,000, making newcomers more and more wary of it’s impending correction as experts would have you believe, I believe there are still ways to get into the game to potentially make just a little bit of money (or lose everything). As a disclaimer, I think it’s good to read comments by experts because after all, they know more about the industry than we do. But don’t just take their word for it, because empirical data has proven that ETFs in the US have outperformed actively managed funds. So, just use their comments as a point of reference, not gospel truth.
Like you, I am wary of the bitcoin bubble, not knowing when it might just decide to burst. And my heart cannot take the loss of $3,000 in a few minutes, which was what happened today. But that doesn’t mean that I can’t play the game. Remember, bitcoin is tradable to 8 decimal places, so while 1 bitcoin is worth $20,000 now, and I don’t want to risk such a large sum of money, I don’t have to buy 1 bitcoin. Technically speaking, it is possible to buy 0.00000001 bitcoin (called a Satoshi; but not the story for today), although I’m not sure if any trading platform would allow for a trade that small. The point is, you can buy a fraction of a bitcoin. So 0.001 bitcoin costs only $20, which is something you and I can afford, isn’t it? Say you do get into the game at $20 for 0.001 bitcoin. Its value continues to rise to let’s say $130,000 (US$100,000, the next most realistic milestone), that would be an increment of $110,000, and you would’ve made $110. Yes, that’s very little, but it’s also a 550% profit. If it falls by $3,000, you’re just losing $3. We don’t know how far it can grow. Nobody knows. Who would’ve thought the US$0.39 bitcoin in 2010 would be worth over $15,000 today? Numerically speaking, there is no limit to its growth. But if it all crashes and disappears into thin air, how much would you lose? $20. That’s it. The beauty of it is, you cannot lose more than what you put into it.
My policy is, play the risky game only with a sum of money that does not cause you jitters if you were to lose it all. If even losing a dollar on it would drive me crazy, I will not play that game.
Update 23/01/2018: I just realised that while recognized as a legal form of payment, Bitcoin is not legal tender.
Gosh Bic camera accepts bitcoin!?! dang now i wish i have bought some long time ago hahaha Thanks for the inputs on the bitcoin scene in Japan! That is true, only invest what you can afford to lose! Maybe when the prices are more stable i will buy some 😀
Yea. I should’ve thought to invest when I first saw the signage that they accept bitcoin, but like I said, I’m not a big risk taker and also, I was focused on something else then. Couldn’t afford to dabble in bitcoin yet. The blockchain industry is getting very interesting and regardless of the fate of bitcoin, the fact is, it is a revolutionizing technology. Although I feel like the mining of bitcoins is doing a lot of harm to the environment =\
regarding moolahsense, the initial 1k deposit is more like a verification thing. most of the loans now starts at $500 (so, the initial 1k that you put in , will basically allow u to lend into at least 2 businesses at 500 each).
that said, they recently decided to put a 1% fee (can easily go to a whopping 12$) on interest earnt for every single transaction made after 11 dec. so , when my initial investment (i’ll have a 10% gain in total) is done and over with, I’ll probably step away from them.
by the way, in singapore, moolah sense isnt the only P2P lending platform. you can read up on funding society and capital match, although i guess you’d come to the same conclusion as what you already have made in this blog post…
https://blog.seedly.sg/p2p-comparison/ <- more material for reading
in the meantime, other than “P2P lending”, there are also things like robo advisors, monthly investment plans (aka regular savings plans) and what not in the market now. waaaay more than 5 years ago if u ask me :O
Wow, that’s very good insight. Thanks for sharing.
I’ll take a look at the link you provided.
no prob! Alternatively you could probably drop me a mail or something, and i could share more of what ive found i guess o-o;
Sure! Let me try to digest the information and reach out to you if I don’t get so confused that I have no idea what I don’t know =\