Mintos launches regulated notes

Mintos has finally launched its long-anticipated regulated notes that intend to bring transparency and protection to loan investing.

The European lending marketplace secured the investment firm licence it needed back in August 2021 and has been working on transitioning its loan investment product into loan-backed securities since then.

It pushed back the launch this February, citing “unforeseen limitations in some EU countries” in a post that said notes would launch later in the year.

New asset-backed securities will allow retail investors to invest in loans “in a regulated environment, providing increased investor protection and a whole new level of transparency,” the company said.

With the new, regulated structure in place, Mintos customers will be protected by the MiFID II investor protection framework as their assets will be safeguarded because Mintos is required to hold investors’ funds separately.

“We’re excited that our hard work on the setup for investing in loans in a regulated environment has come to its fruition, and we can say with confidence that Mintos has raised the bar as we bring loans as an alternative asset class up to the standard of mainstream financial markets,” Mintos CEO and co-founder Martins Sulte said.

“A clear and well-established regulatory framework such as MiFID II brings additional layers of protection and transparency for investors - something that’s crucial when it comes to an alternative and relatively new asset class.”

Investors will also be protected by the investor compensation scheme, which provides compensation up to a maximum of €20,000 if the company cannot return financial instruments of investor funds.

“While the benefits bring more confidence to investors who are already investing in loans, they will also increase the attractiveness of loans as an investment for those on the fence regarding this asset class,” he added.

From now until July 1 2022, Mintos will be phasing out its current investment offering to switch exclusively to notes.

It expects to passport its services across the EU in the second half of this year, allowing the company to give investors across the whole of the EU a chance to invest in notes.