Squirrel Money

Squirrel Money - Effective financial solutions

Squirrel Money has been in business for more than 10 years, amongst other products and services we offer, we also specialize in mortgage broking and peer-to-peer lending and insurance, our products and services have been hand-picked in order to deliver the best possible service to New Zealanders.

Squirrel Money was the first peer-to-peer lender in New Zealand that offered loan trading on a secondary market also offering investors a mobile app so that they could quickly manage their ongoing investments.

We offer complete transparency to borrowers as well as investors with loan book data that are readily available. Squirrel Money New Zealand is the second cab off the rank as far as peer-to-peer lenders go in NZ, but we do offer a number of firsts for this sort of market.

A few ins and outs about peer-to-peer investing

The perception is quite a simple one. Individuals with money who are looking to invest lend to individuals who are looking to borrow.

This is all simplified through the online platform of a peer-to-peer provider. Let’s think about it as a matchmaking service for money; one where looks don’t really count.

This is how a peer-to-peer platform works – it’s sort of like Tinder except it’s for money. Those that want to borrow money use an online loan application through a peer-to-peer provider; if the online application is approved they are matched up with funds from people who want to invest. In other words, the peer-to-peer lender provided the platform in order for the match to take place. Pretty simple!

By these means, the peer-to-peer middle-man is simply cut out, since they’re run online keeping the overheads low. The borrower benefits from lower interest rates and charges – the investor gains through higher investment returns.

Squirrel Money Services

It’s essential to note that peer-to-peer lending still embroils all the controlling checks of a traditional personal loan, like credit check, identification verification and affordability.

A diversified portfolio, factoring in demographic, credit profile and loan purpose, for example, is key for any P2P lender as it allows for better credit control.

There are two types of peer-to-peer loan risk models; peer-to-peer lenders are permitted to adapt to manage credit risk for the investors or a reserve fund model or a fractionalization model.

The reverse fund model

Then we have the reserved model approach which has to date been quite popular in the UK market, companies have proudly reported that investors have not lost a single penny under this model.

This model has been adopted by Squirrel Money in New Zealand that has the same claim.

The reserve fund model has made peer-to-peer investing a fast and easy process.

The investor will select the amount they would prefer to invest as well as the term and minimum interest rate.

The investment orders are typically matched with personal loans that meet the standards. The investor receives regular principal with interest on the repayment of their investment.

The investor receives regular principal and interest repayments on their investments, using the reserve funds that are available for any neglected repayments from the borrower.