Note*the company name will not be revealed just like the previous post as my money are still inside moolahsense, haha(this is not a sponsored post by the way)
Date of listing:FEB 2018
Tenor: 63 days
Note type: Invoice financing
Quoting from let's crowd smarter website...
- Equal installment: Invoice financing refers to the sale of accounts receivables by a company for immediate cash. It is a form of short-term financing often used to improve a company’s working capital position. Invoice financing is similar to short-term loans, although there are some differences.
- Repayment frequency: Will be paid at the end of the campaign
Quoting from Moolahsense website
- Target interest rate: The maximum rate the issuer is willing to provide the interest on the principal subscription amount which the issuer wished to obtain, as notified in writing by the issue to Moolahsese
Quote from valuepenguin:https://www.valuepenguin.sg/what-is-working-capital
- Working capital: It is a concept to describe a business ability to cover its short-term operating costs
- E.g For this campaign, I have funded $200 into it
- As the target interest rate is 12%, this means that at the end of the tenor, which is only 63 days/2months I will expect to receive $204
- 1 year=12%
- 2%(Interest for 2 month)=($200/100)*2=$4
- 102%(The Principal + the interest for six month)=$200 + $4=$204
- Since the payment will only be made at the end of the campaign,i will expect to receive the lump sum of $204 at the end of the campaign
- The issuer is a company incorporated in Singapore in 2011.
- The Issuer is in the building and construction industry and has around 20 employees.
- The Issuer is specialized in electrical engineering works and is registered with the Building and Construction Authority of Singapore as a Registered Contractor for Electrical Engineering
- Invoice Financing- The Issuer seeks to obtain short-term financing and working capital through this loan, which is expected to be repaid from the proceeds of the Issuer.
Due to it being a invoice financing,no financial statement is presented,except a summary
Turnover(the amount of money taken by a business in a particular period):$2,594,655,.00
Debtor industry: Construction
Invoice Face Value:$135,850,00
Invoice Payment Terms: 63 days
Why did I invest in this loan?
- The invoice financing period is only 63 days(due to late payment, the company still owes me about $30)
Net repayment is almost the same as the working capital that I have calculated above:$204
The downside for invoice financing is that both principal and interest are only payable at the end of the campaign
Stay tuned to my next week post:moolahsense(my ninth campaign)!