Below are some of the most commonly asked questions about FundedByMe Loan Crowdfunding and crowdfunding in general.
If you have a specific question for an entrepreneur you can post it on the "Questions" tab of the campaign presentation.
If you have a specific question for FundedByMe, click the chat bubble below or proceed to our contact page.
How does Loan-based Crowdfunding work on FundedByMe?
Loan-based Crowdfunding is the method whereby several individual lenders collectively contribute to the overall business loan of a company, helping grow its business while offering you a good return on your loan.
How much can I lend to companies?
You can lend at the least EUR 50 and up to EUR 3,647 to companies seeking loans on the platform.
Why should I lend through FundedByMe instead of a bank?
By lending to companies through FundedByMe, You can receive up to 14.33% yearly, which is higher than the rates offered by the bank. Additionally, you have control over how your money is used by the Swedish companies you wish to support.
What criteria do companies have to meet in order to seek loans on the FundedByMe platform?
Companies need to have been registered for at least 1,5 years and have an early turnover of at least EUR 15,000. In addition to this, companies need to be determined by credit bureaus, UC and Bisnode, as possessing a favourable risk rating.
What should I consider before lending money to a company?
There are several factors you should take into account before lending money to a company. In addition to contemplating which company you wish to support, you should consider your risk tolerance and expectations of what income you want.
How does the security for loans work?
For companies seeking a loan above EUR 40,000, we require a personal guarantee. This means that the majority shareholders or board members have to individually or jointly guarantee to the full amount of the loan.
How is the interest rate set?
The interest rate is calculated at a yearly rate and with accordance to the record of the company on Bisnode and UC.
What is the FundedByMe risk indicator?
The FundedByMe Risk Indicator estimates the probability of default for a given company over the coming twelve-month period. The lower the percentage, the better.
A+ Exceptional <1,13%
A Superior 1,14 – 1,694%
A- Excellent 1,695 – 2,258%
B+ Great 2,259 – 2,822%
B Very Good 2,822 – 3,385%
B- Good 3,386 – 3,95%
We do not accept companies with a probability of default above 3,95% on our platform.
What happens if the loan is not fully funded?
In the event the campaign does not reach at least 80% of its goal, all lenders will be refunded.
How will the loan be repaid?
Repayments are paid out quarterly on the 27th of the last month in that quarter, i.e. 27th of March, 27th of June, 27th of September, 27th of December. You will receive the same repayment amount each quarter, which includes repayment of the principal and interest.
How is the tax paid?
The entrepreneur withholds the capital tax on behalf of lenders with Swedish tax residency. For lenders with non-Swedish tax residency, or for more information, please review the Manta Tax Advice.