Crowdlending on ITSAL-INVEST

CROWDLENDING DEFINITION

With ITSAL-INVEST, become actor of your savings !

Millions of people save money regularly but how many are those who truly know the destination of their savings?

The interest rates of saving products are lowering more and more but the Livret A is French people preferred product. Have you ever wondered yourself whether other solutions, easy, secure and cost-effective, exist?

Since October 2014, France, one of the pillar of the collaborative economy, allows individuals and businesses to lend to other companies via online platforms like ITSAL-INVEST.

This signs the beginning of the end of the banking monopole and puts back the investor at the heart of projects to be financed.

When I lend on Raizers : 

  • I allow businesses to grow, to expand their business abroad and hire new people
  • I become a local economy player and I get involved alongside a company, a project or a brand that I trust and I believe in
  • I subscribe an innovative savings product with an annual return of 3% to 10%
  • The risk is measured and transparent, I can easily diversify investments
  • I develop my network and I meet investors with different backgrounds

HOW CROWDLENDING WORKS ON ITSAL-INVEST

Raizers may propose bonds to investors through its online platform. This type of loan is currently almost unknown in France because it was, until 2014, mainly used by public institutions.

Bond example:

  • Leding amount : 10 000 €
  • Maturity : 3 years
  • Annual interest rate: 10%
  • Principal repayment: at the end(in fine)
  • Interests payment: annual 

Why choosing the bond rather than the conventional loan ?

  • Individuals but also companies can lend
  • You can lend up the amount you want (amount limited to 1,000 € on conventional loans platforms)
  • Return on investment is higher when the capital is repaid at the end of your investment rather than monthly repaid (interest is calculated on the same outstanding capital every year)

INVESTMENT PROCESS ON ITSAL-INVEST

  • First step : Registration

Registration on Raizers is free and is done in one click, using your email address or your LinkedIn profile.

  • Second step : Access to your account and details by project

Your account allows you to access to all the information relative to the projects presented on the platform:

  • Presentation of the company: the team, its business, its market, its development plan
  • The project: the loan amount, maturity, interest rate and terms of payment of interest and repayment of principal

This account allows you to share information with companies via the access to the dedicated forum of each project.

  • Third step : Your investment

We suggest you first to complete your profile. Stating your location and your areas of expertise increases the chances for you to meet other investors and expand your network. This is also an opportunity to communicate on your skills and why not use it to support companies in which you invest.

 

At the time of the investment :

  • You receive the legal document which includes all information about the company, its project and the full investment operation
  • We ask you to attach KYC documents needed for the validation of your investment, in compliance with anti-money laundering laws
  • You have to complete a legal test to see if your project of investment is relevant given your investor profile
  • You sign an electronic subscription form and pay your subscription
  • At the end of the fundraising, the funds are transferred to the issuer. If the minimum fundraising is not reached, the funds are completely refund to investors.

No fee will be charged on investors by Raizers, except in exceptional cases for which a particular communication is made.

  • Fourth step: Investment follow up

The schedule of the loan is available in your personal account. The interest and principal are paid on the dates indicated in the calendar on your Raizers account.

Following the payment, you can :

  • Re-invest your money in new projects
  • At any time, request that you want the amount of your Raizers account to be transferred to your bank account

TAXATION

You are an individual established in France

The interests you receive, called "bond coupons" are fixed-income investment products from tax administration point of view.

These products are subject to :

  • Social charges, deducted before payment (15.5%)

A fraction of the social contributions (CSG 5.1%) is deductible from taxable income for the relevant year. This amount will be calculated and automatically deducted from your taxable income by the tax administration.

  • The scale of income tax with a pretax payment on income (24%) deducted at source * (not withholding **)

* This payment is automatically deducted and paid back in the form of a tax credit in the pre-completed tax return (2CK box).

Nevertheless, until 30th November of the year of investment (N), you can ask to be exempted from required deposit if the income tax reference (RFR) of your family on N-2 income is:

  • Less than € 25,000 if you are single, divorced or widowed,
  • Less than € 50,000 if you are subject to joint taxation.

This exemption application is a sworn statement that engages your liability for misrepresentation. Thank you to contact us via the contact form if you would like a sample exemption application model.

** If you have received less than 2 000 € of net fixed income from investment products in the year N, you have the option to opt for a flat rate of income tax of 24%. If necessary, your pre-filled tax return, scratch the 2TR box and enter the correct amount in 2FA.

 

You are a company

The interests you receive, called "bond coupons",  are fixed-income investment products from tax administration point of view. They are recorded as financial income and as such are subject to corporate tax (IS).

 

You are an individual or a company established abroad

Taxation principles are different depending on the country where you are resident. Please contact us via the contact formula if you need specific information. 

 

Every year during February, you will receive from Raizers a Fiscal Form (IFU) gathering details of income received and withholding taxes applied in order to facilitate your tax declaration.

RISKS

Careful ! Please remember that all investment bears a risk, and so does investing in crowdlending, with specific risks :

  • A liquidity risk

?Liquidity is the facility with which you can resell your bonds after being acquired. Bonds purchased from companies which are presented on Raizers are unlikely to be traded on a secondary market in the short term. You might not be able to sell the bonds held at the time you intend to.

  • A political risk

Before the maturity date, new tax restrictions might be imposed on the coupons received from bonds already acquired. The return on your investment might be reduced.

Raizers advises you not to count on the interests perceived as a significant part of future investment.

  • An inflation risk

The value of invested capital and interests received might depreciate throughout the life of the bond. The return on your investment migt be reduced.

  • A default risk

The companies presented on Raizers might not be able to pay the interests due or to reimburse the principal.

All the projects presented on Raizers have been previously analyzed from a credit perspective and validated by our experts’ panel.

However, if anomalies were to be found in the process of payments, Raizers will immediately inform you and will do everything possible to recover the sums.

In all cases, Raizers advises you to diversify your investments and prioritize the investment of money that you will not need during the life of the bond. 

* Details : 

I receive 2 940€ of interests, or the number of companies that have not bankrupt (49) * invested capital (10,000€) / total number of companies (50) * The annual interest rate (10 %) * the term of the loan (3 years)

But I lose 200€, which is the capital lent to the company that defaulted (investment (10 000€) / total number of companies (50))

At the end, I WIN 2 940€ - 200€ or 2 740€ or 27.4% of gross return.