Swaper review March 2020 - My experiences after investing over 35,000€

swaper logo
Swaper is yet another p2p lending platform based in Latvia, founded "already" in 2016, it's not a new entry to the industry. But it's not a very old one either.

Swaper is run by Wandoo Finance Group, and to my understanding, Swaper is their main product.

The main features of Swaper include:

  • Interest rates 14% (+ 2% loyalty bonus)
  • With my aff link, interest rates are 16% until 30.4.2020! 😍
  • Buyback guarantee covers also accrued interest
  • Loans are short-term consumer loans
  • No fees and costs
  • Simple Auto-Invest

How Swaper works

Swaper works by refinancing consumer loans issued by its parent company, Wandoo Finance Group. While Swaper operates out of Latvia, the loans are issued so far in five countries: Poland, Georgia, Denmark, Spain and Russia.

While Wandoo Finance Group's main business is in credit scoring their customers and determining who can they successfully issue loans to, Swaper enables quick re-financing of those loans with individual investors' money. Why would Wandoo want to do that? Because it means their capital returned to them more quickly and they can leverage private investors' capital to grow their business.

Who can invest on Swaper?

To become an investor you need to be at least 18 years old, be a resident of a European Economic Area (EEA) country and have a bank account in a bank situated in an EEA country. An individual is recognized as a resident if he or she is a citizen, has a residence permit or is registered as a tax payer in an EEA country.

How to start investing on Swaper?

To sign up on swaper click on Open Investor Account, create login credentials, provide your personal details and prove your identity.

It is very easy to start investing on Swaper. Here are the required steps:
  1. Got to https://www.swaper.com and click to Open Investor Account
  2. Create your login credentials and agree to terms
  3. Provide some details and choose your base currency
  4. Provide identity verification, e.g. passport photocopy and a recent utility bill
  5. Transfer money
  6. Invest with e.g. Swaper Auto-Invest
That's it.

How to use Swaper Auto-Invest

There's a simple Auto-Invest and then there are more detailed options

You start creating an Auto-Invest profile by clicking on the button Create Portfolio, but before that you can set the size of the portfolio and the validity period for the Auto-Invest Portfolio. By setting the size to a big value and term as well, you'll ensure the portfolio won't cap your investing.

But, once you are ready to approve the new portfolio, Swaper does provide a More Options view. That one requires a bit of explanation.

on swaper auto investing settings you can define portfolio size, portfolio term, annual interest, max investment in one loan, remaining principal amount, loan term, don't invest if balance <, countries, reinvest, extended and delayed parameters.

  1. Portfolio size sets the maximum for the Auto-Invest portfolio. I always just set this to a high number.
  2. Portfolio term is the validity duration for the Auto-Invest Portfolio, after which it will stop. You can always stop it manually, so I just put the max here too.
  3. Annual interest lets you define the interest rates you want to invest in. Since for now at least, all loans on Swaper are fixed 12%, I leave this blank.
  4. Max investment in one loan lets you define how diversified you want to be. A small number here means your principal will be more spread. Since Swaper provides a full Buyback guarantee, I don't care and I set this at a high number, e.g. 1,000€.
  5. Remaining principal amount means how much you want there to be still invest-able. I always leave this blank.
  6. Loan Term in Months is important. This defines how long loans you want to invest in. Most loans are very short, but if you want to invest only in them, you should set a low max for the term, e.g. 3 months. I've recently used the max 36 months here, since there is the after market.
  7. Don't invest if balance < means what it says. If you want to keep a certain balance on your account, set that here. I don't know why you'd want to. I always leave this at zero.
  8. Countries lets you filter by country. I don't see why I would want to again for the buyback guarantee.
  9. Reinvest if you don't set this ON, then interest will not be re-invested by this Auto-Invest portfolio. That's silly. Leave this ON.
  10. Extended loans mean the borrower has paid interest, but has deferred the payment of principal. This usually happens when they have trouble making ends meet. I don't mind and I leave this ON since Swaper covers for defaults. These come from the after market.
  11. Delayed means loans that are late on their payments. These also come from the after market. Again, since Swaper covers for defaults and late, accrued interest, I leave this ON too, but I've seen others recommend against it.

Swaper interest rates

Similar to Robocash, all loans on Swaper are listed with a fixed yearly rate of 12%. Additionally, if you invest more than 5,000€ for at least three months, you earn an additional 2% as loyalty bonus, a total of 14%.

My Swaper returns are 13.2%

My personal experience has been a solid 13% internal return rate. I believe it is the occasional cash drag that keeps this from reaching the full 14%, although I am entitled to the loyalty bonus.

But 13% is pretty darn impressive nonetheless. Imagine how your portfolio would compound over time if that kind of interest would continue! Try the compound interest calculator below and see for yourself.

Of course things can change and previous performance isn't a guarantee of the future. There's always risk.

Swaper risks

Swaper's risks are very much coupled with its parent company, Wandoo Finance Group's, risks. Wandoo issues the loans and Swaper refinances them. If one of them becomes insolvent, it's equally bad for the investor.

wandoo logo


Swaper's parent company, Wandoo Finance Group, issues the loans. This setup has its advantages: there are almost fewest possible middlemen to split the pie with. For this reason, even if the investor gets a decent interest, there's still some margin left for the platform. But there are downsides, too.

When a platform brokers loans between the investor and loan originators it can offset almost all of the risks to the other parties. When it acts as the loan originator itself that provides also buyback guarantees, it needs a strong balance sheet and a solid risk model, as it is the first one carrying the credit risk. If it fails in managing that risk, it risks becoming insolvent, which is bad news for all investors on the platform. I see this as the biggest risk on Swaper, but also its competitive advantage, potentially.

Wandoo Finance Group does state they are experts of developing credit risk scoring systems, which if true, means they should be the loan originators, not brokers. Brokering is easy, but lending profitably - that's going to separate the winners from losers when the economy takes a turn for worse.

Unfortunately, Wandoo Finance Group's annual reports aren't publicly available, so I haven't got my hands on them. I will keep looking for those, so be sure to bookmark this page and come back later!

For as long as Swaper stays up, the buyback guarantee will cover your investments. If Swaper fails in predicting the credit losses for the loans they issue, they might run out of buyback cash.

Cash drag on Swaper

I've experienced intermittent cash drag on Swaper. For those unfamiliar with the term, "cash drag" means my money is sitting in my account, not invested in loans and thus, not earning interest.

Cash drag is very real on Swaper. One way you can combat cash drag is to create multiple slightly different Auto-Invest portfolios. This hasn't always been completely successful, and I do suffer from occasional cash drag.

Cash drag has a negative impact on your returns and is therefore a real risk. If you cannot get your money to work, what good is it?

Liquidity and aftermarket

Liquidity overall is very good on Swaper. Pretty much all of my capital is on short-term, 30 day loans. If I stop my Auto-Invest portfolios, within 30 days I will have most of my capital and after another 30 days the buyback guarantees have covered for most of what's remaining.

Thus, if I have an urgent need for cash, I will have a decent flow of it in a very short term.

If that's not enough, there's still the after market. And since there's a bit of cash drag, it seems extremely liquid.

So, liquidity isn't a problem.

Swaper buyback guarantee

Indeed, Swaper provides a full buyback guarantee on all its loans. The buyback guarantee also covers for any accrued revenue for the time that the payments are late.

The buyback is triggered once the loan is late for more than 30 days for short-term loans and 60 days for long-term loans.

Swaper team

Swaper was founded by a long term crediting and investing professional Iveta Bruvele (LinkedIn). Before founding Wandoo Finance Group and Swaper, Iveta has worked in Swedbank, 4finance, twino and Binarium. She knows her shit.

What I also like about Swaper is that they have lots of women in the company. Almost all their key roles are occupied by women, including Margarita Jankova, and Elina Rasmane and Diana Konina to name a few. And all of them seem to share similarities in their past careers.

swaper and wandoo finance group team is very experienced

Call me sexist or feminist, but I do genuinely feel that on average, women have a stronger moral compass. If you look up the greatest con artists of all time, you won't find many women in there. I trust female leadership more. Maybe I shouldn't, but I do.

If everything is as great as it looks like on paper, then Swaper is a great platform. They boast that their machine learning model is superior to other loan originators. I have so far chosen to believe them.

There are at the time of writing 100 people working for Wandoo Finance Group, and as far as I can tell the structure looks like a healthy IT company.

Full disclosure

I've transferred over 35,000€ on my Swaper account and have received so far 13.2% internal return on it. My Swaper account value at the time of writing is down to 18,124€ since I've withdrawn money to be diversified on other great platforms and will continue to do so. Over time, I plan to keep at least 10,000€ on Swaper and I am very satisfied.

If you're looking to diversify your peer lending portfolio, Swaper is definitely an interesting option. What sets Swaper apart from most other platforms is that, similarly to RoboCash, they are the loan originator and they provide buyback guarantees. When successful, this enables them to be very efficient in their operation, but it does come with quite a bit of platform risk.

When you sign up using my affiliate link, it helps me run this blog and you get an interest rate of 16% until the end of April.

I'm giving Swaper three stars ⭐⭐⭐. They have chosen a risky mode of operation and unlike RoboCash, we don't have a full picture of how well funded they are. But, they do have a stellar team with precisely the right expertise. I'm greatly satisfied with the interest I've received so far and I believe Swaper to hold the right cards to be able to win in this space. Once we start seeing Wandoo Finance Group annual reports and we get rid of the cash drag, I'll up my review to four stars, but five stars will take time.

If you like Swaper and would be interested in some great alternatives to it for diversification, have a look at the following:
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