Kuflink Review (UK Lender)
(3.7 / 5)
My Actual Account Growth
– Review Updated October 2018
My 100% unbiased Kuflink review. Based on my own investing experience. Highlighting the positives and negatives of investing with one of the UK’s fastest growing peer to peer lenders.
Kuflink – is a medium size Peer to Peer – Peer to Business (P2P/P2B) lender. Providing loans to businesses around the UK, they have a unique offering. Kuflink were the first lender in the UK to offer “skin in the game”, meaning that they invest 5% of their own capital into every loan they offer, taking the first loss on any defaulted loans. Plus on Select-Invest (manual investment) loans, they provide a 20% first loss guarantee offing investors another level of security.
Providing returns from 3.99% up to 7.2% on bridging loans which are all property secured. Loan terms are from 3 to 18 months on Select-Invest, and from 1 to 5 years on Auto-Invest accounts.
Kuflink are growing fast. With great customer service and a growing loan book. They have a unique offering. I have only been investing with Kuflink for a few months but so far it has been a very positive experience, and I intend to increase my investment with them soon!
Obvious Investor Easy-Info Table
|Overall Rating*:||(3.7 / 5)|
|Who can invest:|
|Estimated Return:||3.99% to 7.2%|
|My Actual Return:|| 5% auto-invest. |
|Risk Rating*:||4/10 - Low to Medium|
|Deposit Funds:||By bank transfer. Usually takes 24 - 48 hours for BACS. Can be same day for Faster payments.|
International payments can be made through TransferWise.
|Lending To:||Agreements directly with borrowers|
|Loan Types:||Bridging Loans.|
|Default Rates:||Actual 2.25%. |
No lender has lost capital.
|Loan Security:||Yes. Property with good LTV's. Typically below 75%|
|Provision Fund:||No. However offer "skin-in-the-game". |
|Time to Invest:||Auto-Invest - almost instantly.|
Select-Invest - varies, dependent on available loans.
|Time to Mange:||None (Auto-Invest).|
|Payments Received:||Interest payment received annually on Auto-Invest loans, monthly on Select-Invest loans.|
|Amount Lent:||£24 million+|
|Number of Investors:||N/A|
|Telephone:||01474 334499 (UK)|
|IFISA/IRA:||Yes: IFISA (Auto-Invest loans only)|
|Cashback**:||Yes! £100 Cashback! Click here for further information.|
|How to Sign Up**:||Sign Up Here!|
Kuflink’s Peer to Peer business was launched in May 2016 in Gravesend, Kent UK. Their property bridging division has operated for many years before launching their Peer to Peer business, however in the 3 or so years they have been offering Peer to Peer loans, Kuflink have lent almost £25 million on over 38,000 investments. Remember, when investing in P2P businesses, your capital is at risk, however to date no Kuflink investor has lost any money.
Kuflink are regulated by the UK’s Financial Conduct Authority (FCA) with full permissions under FCA number 724890. They gained FCA permissions in April, 2017. It’s important to note that the FCA is not the same as the FSCS (Financial Services Compensation Scheme), so capital is not protected as it would be in a bank.
Opening an account with Kuflink is fairly easy. Just the usual ID and anti-money laundering checks. If they can verify you though one of the UK’s credit agencies, you may be approved immediately. If not, you may need to send them a copy of your passport or driving license, and a utility bill or bank statement. Residents of most European countries can sign up with Kuflink if they can pass the ID checks. A UK bank account is also required to signup. If you don’t have a UK bank account, see my TransferWise Borderless Account review for more information on how it may be possible to get UK banking details if you’re not a UK resident.
Deposits & Withdrawals
Deposits and withdrawals are made by bank transfer from a UK bank, or an international bank account via TransferWise. From a UK bank account, deposits usually show up in your account the same or next working day. Depending on where the money is coming from, funds deposited through TransferWise can also show up the same day in some cases. 24-48 hours is typical if not. Withdrawals are only to a bank account, and typically take 2 – 3- business days.
Time to Become Invested
When investing in their auto-invest accounts, investment is typically very quick, it took my first investment a few minutes to get the funds distributed between loans. With manual Select-Invest loans the time is dependent on how much research you need to do on the individual loans, and how many loans are available.
Who are we lending to?
Kuflink is a true Peer to Peer Platform. Lenders are lending directly to borrowers who are typically small to medium size British businesses. Loan agreements are directly between the lender and the borrower. Kuflink just acts as a middle man, managing loans, payments and debt collection etc.
Kuflink only provide loans secured by property. The Loan to Value (LTV) ratios are typically good, below 75%. Loans are first or second legal charge on the properties the loan is against. Their website provides good information on the security of each property.
It is even possible to drill down and see the full valuation report, in the case of the property in this screenshot, the full report was 59 pages!
Kuflink loans do not amortize, so only interest payments are received until the principle is paid back in a lump sum at the end of the loan period. On Auto-Invest loans, interest is paid annually. With manual Select-Invest loans, interest is paid at the beginning of each month.
Selling Loans and Withdrawing Capital
There is no early exit with Kuflink loans, so once you make an investment, you are in for the duration. Loans are typically 3 to 12 months on manual Select-Invest loans, and 12, 36 or 60 months terms on the Auto-Invest loans.
Auto-Invest loans are diversified automatically when you initially invest with Kuflink. Capital is spread between available loans in each loan portfolio.
In the screenshot below, you can see that I deposited £500 initially and this was split equally between available loans.
Diversification on these loans is not as much as I would hope for, however because Kuflink have good loan security, and they invest 5% of their money into Auto-Invest loans on a first-loss basis, I’m comfortable with it.
With manual Select-Invest loans, you obviously diversify your capital into loans manually. The loan book is not very big with Kuflink, so you have to be prepared for less diversification.
There is no provision fund as such, however Kuflink invest 5% of their own money on a first loss basis into each loan, and they provide a 20% first-loss guarantee on all of their loans too. This seems to work well as to date, Kuflink state that no lender has lost any capital. They have had defaults though, (the rate they quote for the last 12 months is a little over 2%).
Kuflink offers an Innovative Finance ISA which was launched in July 2017 for UK residents. Only Auto-Invest loans are available through the ISA.
Kuflink’s website is easy to use and provides good information for both auto-invest and select-invest accounts.
When you log in to the website you will see the Dashboard with your accounts and balances displayed, as well as loans you are currently invested in.
On the auto-invest page, you can see rates available for the 12, 36 and 60 month loans, 3.99%, 5% and 5.35% respectively . Simply choose your investment, and the amount you want to invest. Kuflink will then place the money on loan for your almost immediately. That’s it! If you don’t have the time to do the due diligence on manual select-invest loans, Auto-Invest is a good option, although the rates of return are a little lower.
As mentioned previously, something that is a little different with Kuflink to many other P2P lenders is that they pay interest annually on auto-select investments, so you won’t see your account grow month by month. You’ll need to wait to see your account grow. There is also no early exit on Kuflink loans either, so you’ll need to wait until loans are matured if you need to withdraw money.
On select-invest loans there is a wealth of information available on Kuflink’s website. The individual loans, terms and valuations are all available to help you make your decision on where to invest. When you hover over a loan in the “Available Loans” page, you will see a box pop up giving you information on loan term, date etc. You will also notice how much capital Kuflink is investing in to the loan itself.
As you click on an individual loan, you will see even more detail on the loan, as well as full access to a detailed valuation report from reputable Charted Surveyors as in the screenshot shown earlier in this review.
Once you find a loan you want to invest in, Kuflink will show the minimum investment required in the loan to earn 1p of interest over the loan period. When you enter the amount you want to invest in to the investment amount field, Kuflink will then tell you how much you’ll earn over the loan period on that amount, at the advertised interest rate.
It’s early days for me with Kuflink, but so far the experience has been good. Their LTV’s are very reasonable, and because they invest into each loan themselves, it means they will be extra careful about who they loan our hard earned money to. Evidenced by the fact that no investor has lost money to date out of the 38,000+ investments they have processed.
Thumbs Up Points for Kuflink
- Skin in the Game – Kuflink invest 5% of their own capital in to auto-invest loans, and they guarantee 20% in select-invest loans on a “first in, last out” basis which gives an extra layer of protection to investors.
- Property Secured with Good LTV’s – loan-to-value numbers seem very resalable, which means that in the event of a default investors should be able to recover most of their investment.
- Auto-Invest –there are three auto-invest accounts if you don’t want to self select making investing hands off requiring very little time to maintain.
- Detailed Loan Information – for select-invest loans there is very detailed information to help investors make an informed decision.
- Website – very easy to use and understand.
- Diversification – with the auto-invest accounts Kuflink spread your investment over as many loans as possible helping you adhere to the “Prime Directive” and diversify your investment.
- Low minimum investment – £100 to start. Minium investment per loan is “enough to earn 1p of interest”. If your portfolio is still small, it’s still easy to invest with Kuflink and still diversify over many loans.
- Financial Conduct Authority (FCA) Regulated.
- IFISA available for UK investors.
Thumbs Down Points for Kuflink
- No Provision Fund – no provision fund. However their “skin in the game” goes a long way to cover any possible defaults.
- Smaller Company – with shorter track record, launched in 2016, Kuflink haven’t had to deal with a financial crisis yet, so we won’t know how they fair until the next one.
- No Early Exit – No secondary market to sell loans so once you invest, you’re in for the duration. Most loans in select-invest are 18 months or less though so it’s not too long to wait.
- Interest Paid Annually – on auto-invest accounts, you won’t see your account grow until you’ve been invested for at least a year.
- Smaller Loan Book – Kuflink seem to go for good quality loans, with good LTV’s. Their credit requirements are very strict. This means a smaller loan book for diversification purposes, however the loans they do have are safer than many loans found on other platforms.
Risk Factor – 4/10 – Low- Medium
I consider Kuflink to be in the low to middle area of the risk scale. Even taking in to consideration that loans are secured, and they have “skin in the game”, they are still a young but fast growing company. I have enjoyed investing through Kuflink, and based on my experience thus far, I think they’ll go on to do great things. TrustPilot reviews give them a great rating which they certainly deserve.
Who Can Invest with Kuflink
Residents of most European countries with a U.K. bank account can invest with Kuflink. Contact Kuflink for further information.
Offers & Signup Links**
New customers receive £100 cashback on an investment of £500 or more when they use signup links from obviousinvestor.com. Must invest £500 into loans within 24 hours of first investment.
* My opinions on ratings and risk rating factors refer to my personal experiences with the lender. Including factual data such as interest rates, loan types, security, platform history, default numbers etc. Read my Disclaimer before making investment decisions.
**Affiliated! – I am an investor with this company! (I only review companies I invest with so I can provide an honest evaluation based on my own experience). If you click on an affiliate link, I may receive a small commission, at absolutely no cost to you. It helps me to run this website and continue to offer new reviews and updates.