Investing - Marketplace

Frequently Asked Questions

Investing - Marketplace

Who can invest?

Currently only wholesale clients can invest through SocietyOne. Find out more about wholesale clients. Please note that wholesale clients includes individuals who meet the requirement. Over 95% of current investors on the SocietyOne platform are individuals.

We are working towards being able to accept investments from retail clients mid 2017.

Why can't retail clients invest now?

This is a new type of investment in the Australian market. SocietyOne has originated loans on our platform since August 2012 and have wanted to prove our systems, credit models and returns to investors and regulators before opening to retail clients.

Can a SMSF invest?

Yes if it meets the wholesale client test.

Can I invest as a trust or company?

Yes if it meets the wholesale client test.

What is the minimum investment amount?

Currently the minimum investment is $25,000.

Is there a maximum investment?

There is no maximum investment.

What will I be investing in?

SocietyOne currently facilitates two different types of loans - unsecured personal loans and secured livestock loans.

How do I apply to invest?

Register your interest in investing at our registration page. After a quick and painless identity check, we'll provide you with a login to the portal where you can view live loans. We'll ask you to tell us whether you want to invest in your own name or through a trust or company and we'll send you a copy of some documents:

  • Information Memorandum
  • Individual Investor Form
  • Investment Agreement
  • Wholesale Investor Certificate template

You'll need to complete, scan and upload these documents to us together with a wholesale investor certificate from your accountant and a copy of a statement for the bank account you'll link to your investment.

On receipt of the forms, we'll provide you with BPay details so you can fund your investment. The funds will be held in a trust account until you invest. You can check your balance through the online portal.

How many Investors are there per loan?

Currently there are on average 40 investors in each loan.

What if there is not enough investor demand for a loan?

Loans that don't receive enough bids will not be funded. 

Can I diversify my investment?

Investors only receive a fractional part of each loan, so your total investment amount is allocated to smaller fractional parts of a much larger loan portfolio. This diversifies your investment across credit grades, geographies, professions etc.

Further diversification can be achieved by investing in more than one class of loan. Currently SocietyOne offers two types of loans; unsecured personal loans and secured livestock loans.

How many loans will I have in my portfolio?

It depends on the instructions you provide to SocietyOne - which we call a mandate. Currently, most investors are invested in over 100 loans.

How long does it take for my investments to be deployed into loans?

Once you have funded your account and uploaded the completed Investment Agreement, your investment will be deployed into loans as they are listed on the platform. The time to deployment will depend on factors such as the demand for loans, the size of your investment and your investment choices.

What structure do I invest through?

Each class of loans (personal, livestock etc) is managed through a separate trust which is an unregistered managed investment scheme. You receive interests in the managed investment scheme - initially your investment is held in cash (which we call "cash interests"). Your interests change to "loan interests" when your funds are deployed into loans. As loans are repaid, the loan interests convert back to cash interests.

Do I invest directly in loans?

You receive an equitable interest in the loan which entitles you to receive the interest and capital repayments for the proportion of the loan you have funded.

Can I withdraw the funds in my cash account as loans are repaid?

Yes, you may withdraw cleared funds at call. You can't withdraw funds that have already been bid on a new loan or uncleared repayments.

Where is my cash held?

All cash is held in a Macquarie Bank trust account in the name of the trusts' custodians; Australian Executor Trustees Limited for the personal loans trust (SocietyOne P2P Lending Trust), and Perpetual Corporate Trust Limited for the livestock loans trust (SocietyOne Livestock Lending Trust).

What interest do I receive on the cash balance

SocietyOne receives the RBA Overnight Cash Rate less 0.50% from Macquarie Bank on the pooled trust account. This rate is paid to investors, i.e.SocietyOne does not charge an additional fee for managing your cash interests.

What happens if a borrower defaults?

SocietyOne adheres to strict credit control protocols and passes loans to a collection agency when a borrower is in default. If a borrower does not repay the loan, you will lose the outstanding principal on that loan at the time the borrower stops paying. Likewise expected future cash flows will not be received by the investor, unless funds are received in the recovery process.

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