When you lend money to small businesses through Mekar, a peer-to-peer lending platform, on average you will get a return of 10% per year, with repayments paid monthly. This is already a higher yield than a bank time deposit, which usually pays a simple annual rate of 3.6% up to 6% or maybe a little bit more if you are willing to keep a hefty Rp 5 billion or more in your account.
But did you know that you actually can get a lot more than 10% in Mekar?
As an up-and-coming fintech company, Mekar is always constantly pushing for innovation. With that spirit, in early November Mekar introduced a new feature: Reinvest, which lets lenders (also called funders in Mekar) earn up to 17% per year.
This new feature has been well received by Mekar’s funders. It has only been two months since the Reinvest feature was launched, but already more than 50% of Mekar’s active funders are currently investing using the new feature. These are the funders who are looking to earn a higher yield while still enjoying all the convenience of investing in small business loans through Mekar, including the low risks and a 100% guarantee that protects their initial investment.
So how does the Reinvest feature really work?
When you go to Mekar’s microlending platform, you will see that Mekar offers three investment plans: Average Growth, High Growth and Maximum Growth. The Average Growth plan gives you the most flexibility; you can choose when to fund a loan and how many loans you want to fund. You will receive monthly repayments of principal and interest.
The Reinvest feature works when you choose either the 12 Months Invest, 18 Months Invest or the 24 Months Invest plan. Both plans require you to invest a minimum of Rp 30 million. You can choose to let Mekar automatically select the loans for you to fund or you can manually choose them until the total amount of all the loans you are going to fund reaches at least Rp 30 million.
Mekar will continuously reinvest all monthly repayments made for the loans you have invested on in more new loans. The platform will automatically do this for the period of 12 months in the 12 Months Invest plan, or 18 months in the 18 Months Invest plan, or 24 months in the 24 Months Invest plan. At the end of the reinvestment period, you will receive a lump sum payment for the entire initial investment amount and the returns.
By constantly reinvesting your earnings into new loans, you will be able to compound your returns over time. The longer the holding period, the higher the return. In the 12 Months Invest plan, you will get a return of 16% per year. Choose the 18 Months Invest plan and you will get a solid 16.5% per year. Choose the 24 Months Invest plan and you will get a solid 17% per year.
Check out the infographic below to learn how to earn so much more from your investment in Mekar using the Reinvest feature: