Peer-to-Peer Lending


Harmoney: September 21, 2016


I have continued to invest in Harmoney, where my deposits now total $10,500. But my outstanding principal today stands at $10,531, as I have consistently reinvested (a) all repayments of principal, and (b) as much interest as I have needed to reinvest to prevent my "nest egg" from shrinking. At the end of each month, I have then withdrawn the remainder of the money in "cash available". This has given me a net return on my investment of:

Sep. 2016: $10,500 invested: $70 withdrawn: Net return 8%
Aug. 2016: $10,000 invested: $55 withdrawn: Net return 6.6%
Jul. 2016: $10,000 invested: $80 withdrawn: Net return 9.6%
Jun. 2016: $9,500 invested: $70 withdrawn: Net return 8.85%
May 2016: $9,000 invested: $50 withdrawn: Net return 6.67%
Apr. 2016: $7,500 invested: $40 withdrawn: Net return 6.4%
Mar. 2016: $6,500 invested: $35 withdrawn: Net return 6.5%
Feb. 2016: $6,000 invested: $35 withdrawn: Net return 7%
Jan. 2016: $5,500 invested: $35 withdrawn: Net return 7.65%
Dec. 2015: $5,000 invested: $30 withdrawn: Net return 7.2%

Note that this "net return" is after tax, fees, defaults, and reinvestment of some interest. So far, I have had 11 defaults — 2 by F-grade (the lowest grade) borrowers, 7 by E-grade borrowers, 1 by a D-grade borrower, and 1 by a C-grade borrower. These days, I invest only in A- and B-grade loans, and no more than $25 in any one loan. The above defaults have cost me a total of $253.

Other latest statistics:

(1) Gross interest paid to date: $1,217.54.
(2) Realized annual return (i.e. before tax): 10.29%, as calculated on August 20, 2016. This RAR varies from month to month.
(3) Total arrears as of today: $31.

SUMMARY: I was a little shocked, about two months ago, when I was hit by six defaults at once. It was a setback that was reflected by last month's relatively low RAR of 10.29%. But the associated graph now shows things picking up for my portfolio, and I am reasonably satisfied with the way things are going. — Alan Ireland, retired journalist, Palmerston North



Harmoney: April 24, 2015


Anyone logging into their Harmoney investor account today will see the following notice:

"Update Investor Dashboard Issue (23/4/15): Our team has been working hard to fix the investor dashboard issue. And while progress has been made, we haven’t met our 21 April deadline. We appreciate that this is frustrating and want to assure investors that we are doing all we can as quickly as we can. We will provide more information in an email tonight."

The "investor dashboard issue" does, indeed, appear to be the main problem at the moment. Yesterday, I sent the following message to Harmoney: "I have just looked at my Account Summary. It shows Total Deposits of $500, yet Investments of $525. Then, on the My Performance page, I see Cash Available of $-24.73 and Outstanding Principal of $524.82. The latter page also shows Gross Interest Received of $0.11.and Total Payments of $0.29. While I can see that this $0.29 is a product of Gross Interest Received of $0.11 and Paid Off Amount of $0.18, and that $524.82 is $500 minus Paid Off Amount of $0.18, I am unsure about how you arrived at the other figures. How have I ended up with Investments of $525 when I deposited only $500 [on March 25, 2015], and what, exactly, does the Cash Available of $-24.73 represent? The difference between $24.73 and $25 is $0.27. What is this $0.27?"

Later in the day, I received the following reply from Senior Account Executive Mark Bardi:

"We've been having dashboard errors for the past couple months, where the figures do not always update in real time. As a result, you over-invested by about $25, so that is why you've got a negative balance and your total investments is $525. This was our mistake, so this costs you nothing and it does not require any action on your part. You'll simply have to wait for principal and interest to accumulate to bring the balance back to positive. Think of it was (sic) a $25 interest free credit."

Today, when I looked at my account, I saw that my Investments have now gone up to $550 and that I now have Cash Available of $-49.73. Maybe this is "free credit", as Mr Bardi says. I will, however, be relieved when my account figures finally make sense.

On a more positive note, I give Harmoney full marks for its responsiveness. — Alan Ireland, retired journalist, Palmerston North