Capsphere (Link) is a new peer-to-peer (P2P) lending platform in Malaysia. It is an asset-based P2P financing platform and is the first of its kind in the nation.
Features of Capsphere
The note issuers use the funds raised to purchase or refinance assets for growing their business. The note is collateralised which means it is secured by the issuer’ asset. The assets can be medical equipment, automotive equipment, manufacturing equipment, sports equipment (such as gyms), digital assets (such as servers), specialist vehicles for business purposes (such as forklift) and solar panels.
Registration
There are two types of account: Basic and Premium. The difference is in the total allowed investment amount (up to RM 50,000 or above). Besides that, the Premium user has the privilege to invest earlier. We are required to transfer RM 1.00 to Capsphere during registration to verify the bank account. After two to three business days, the account would be ready and we need to top up RM 1,000 before we can see the notes.
Deposit and withdrawal
Capsphere requires a minimum of RM 1,000.00 for account opening. This platform charges a fee for deposit: RM 1.00 per FPX transaction or 1.5% if using local credit card.
Withdrawal requires two – three business days for the money to appear in the bank account. There is a withdrawal charge of RM 0.10 per bank transfer.
Investment notes
The tenure of the investment notes can be up to three – five years. The investors can expect a return of 8 – 18% per annum. The minimum investment amount is as low as RM 50.00.
Each note is categorised into specific risk classes, ranging from A (excellent credit profile) to F (poor credit profile).
Fee structure
Capsphere charges a service fee of 1 – 2% for every repayment. It is only payable when the issuers repay the loan.
Sales or service tax of 6% will also be charged when applicable.
Default management
There are two ways to handle defaults. One is restructuring the note and second is liquidating the asset.
However, if legal or recovery fees are incurred, these fees will be shared by all investors (weighted by the amount invested). Nonetheless, if Capsphere is able to recover the fees from the issuer, it will reimburse these fees to the investors.
Conclusion
In my opinion, the notes on Capsphere are more secure due to the collateral. Even if the issuer defaults, the investors should be able to get back some money after the sale of the assets. Since it is just launched, there are not many notes yet and I have managed to subscribe to one note only. Let me take some time to evaluate its performance. I will post an update when I have more details.