Go & Grow Portfolio Distribution: July 2019

Last year Go & Grow was the new kid on the block – now it’s one of Europe’s favorite ways to invest.

After more than a decade of credit analysis and developing our proprietary credit scoring model, we launched Go & Grow to open the doors of investing to all. When it comes to investing – most think you need to understand complex financial tools and have some prior experience before you can get started. With Go & Grow, investing is simpler than it’s ever been. And now, nobody is excluded from taking control of their financial future.

In this post, we’re going to discuss some key figures, risks, and take a deep-dive into Go & Grow’s portfolio distribution.

Top 3 key facts

  1. Launched to the world – June 2018
  2. Number of Go & Grow accounts – 31,000+
  3. Loan pcs in the whole Go & Grow portfolio – 80,000+

Is the rate of 6.75%* guaranteed?

The rate is not guaranteed; however, the average net return on the Bondora platform is much higher than this. With this and our 10-year track record in mind, we’re confident the rate of 6.75%* is achievable with the benefit of instant liquidity to investors.

The net return is capped at 6.75%* – all excess returns over this percentage are reinvested to ensure you can earn the rate of 6.75%* going forward, despite there being no guarantee in place.

How will I be taxed?

You only pay tax on the money you withdraw which is over the total amount you have paid in. For example, if you invest €1,000 then anything you withdraw up to €1,000 is considered as a principal withdrawal, anything above €1,000 is considered as interest.

All payments made to your Go & Grow account are regarded as one investment, although the funds have been used to acquire individual claims. This is irrespective of when and in how many parts you paid cash into your Go & Grow account.
If you are unsure, please consult a qualified tax advisor for more information.

Here’s a snapshot of the top ten benefits:

  1. 6.75%* p.a. net return
  2. Faster liquidity
  3. Lower risk
  4. Invest with a minimum of €1
  5. No annual management fees
  6. Tax-efficient
  7. Simple to use – making it great for beginners
  8. Create multiple accounts
  9. Share access to your Go & Grow account with the people you trust
  10. Create a goal and receive updates on your progress

Are there any associated fees with Go & Grow?

We charge a flat €1 withdrawal fee, no matter the size of the account. This helps us continue to operate the Bondora platform.

What’s next for Go & Grow?

Later this year, we plan to release a beta version of the Go & Grow mobile app for a select number of investors. You’ll hear more about this from us in the coming months.

How does Go & Grow work?

If you’ve read any of our other blog posts, you’ll know we always preach diversification. Instead of investing everything into one credit rating, Go & Grow spreads the claims across all eight credit ratings, ranging from AA-HR. The lowest distribution is in AA ratings, followed by A and HR.

Go and Grow portfolio - July 2019

Figure 1a – Go & Grow Portfolio Overview (rounded figures) – July 2019
Go and Grow portfolio - January 2019

Figure 1b – Go & Grow Portfolio Overview (rounded figures) – January 2019

The largest distribution is in F rated loans (45%), followed by E (16%), D (15%), and C (11%). Not only does Go & Grow consist of over 80,000 loan pcs, but our investors also benefit from diversification that traditionally could only be achieved with services such as Portfolio Manager and Portfolio Pro (or an API).

Compared to January, the percentage of F rated loans within the portfolio has risen by 8%. Why is this? As a by-product of issuing more loans in Finland and acquiring new customers, we’ve taken a conservative approach by assigning more borrowers a Bondora Rating of F. Essentially, this does not mean the loans in this category are higher risk – however, assigning this rating allows us to ensure our credit model quality is not compromised as we continue to expand in existing loan markets.

EUR distribution - Expended

Figure 2a – Go & Grow Portfolio Overview (Expanded) – July 2019
Euro distribution - expended

Figure 2b – Go & Grow Portfolio Overview (Expanded) – January 2019

Finland accounts for the largest share of the total at 52%, closely followed by Estonia at 41%. The share of Spanish loans is clearly in the minority, at 7% of the total. Compared to January, the share in Spain has increased by 3%. Within the next 24 months, we expect it to dominate the largest share in our originations.

Figure 3a – Go & Grow portfolio distribution by country – July 2019
Go and Grow portfolio distribution country - percentage

Figure 3b – Go & Grow portfolio distribution by country – January 2019

Below (Figure 4a & 4b), the graphs show the total distribution of originations across Bondora in June 2019 and December 2018, respectively. If you compare figures 1a, 2a, and 3a with 4a, you can see that the distribution of Go & Grow claims mirrors that of the whole Bondora portfolio. We publish a monthly update on this – click here to read more.

Origination distribution by rating and country

Figure 4a – Total Bondora origination by rating and country – June 2019 (€9,563,345 total originations)

Figure 4b – Total Bondora originations by rating and country – December 2018 – (€8,448,570 total originations)

Another interesting point for review is the different goals our investors are striving for. The clear majority is for extra income (63%). However, this is likely to be skewed due to it being the default option. After that, Rainy Day (11%), Retirement (10%) and Big Purchase (8.3%) follow as the most popular goals.

Figure 5a – Investors chosen goal – July 2019

Figure 5b – Investors chosen goal – January 2019

What are the risks related to Go & Grow?

While it’s great to be able to say we’ve delivered on our promises to investors so far (and despite the scenarios below being unlikely), it’s important for us to make sure you’re aware of the risks.

1)   The net return falls below 6.75%

A headline benefit of Go & Grow is the high-yielding return of 6.75%. Compared to the net return rates achieved since Bondora’s inception, the rate of 6.75% provides a substantial buffer. Today, the Go & Grow portfolio mirrors that of the overall composition of the loans originated at Bondora – in other words, across all risk ratings and countries. These loans have been originated using our latest generation of credit analytics, a proprietary model which has been developed for over a decade.

Therefore, the actual Internal Rate of Return (IRR) of the Go & Grow portfolio significantly outperforms the headline rate of 6.75% – the returns generated over this amount are held back as reserves and reinvested to mitigate the risk further. Bondora has no claim on these reserves. Overall, this gives us statistical confidence that the rate of 6.75% is deliverable for the foreseeable future.

However, a risk which may affect our ability to deliver on the rate of 6.75% is the amount of deposits we receive from investors. For example, if more money is added to Go & Grow accounts by investors than we can originate in loans – this results in a percentage of the portfolio remaining in cash (i.e., not earning a return). In this scenario, we may decide to add a limit to the amount new investors can deposit. In an extreme case, we could decide to stop accepting new investors altogether and form a waiting list – similar to Zopa in the United Kingdom.

2)   Liquidity

Before deciding to make super-fast liquidity a benefit for Go & Grow investors, we analyzed close to a decade of cash flow data on Bondora investor transactions to determine the inflows, outflows and how the portfolio cash flows moved overall. This is so investors can rely on being able to withdraw money from their Go & Grow account at short notice.

In addition to this, we analyzed cash flow data from a number of banks and investment funds – specifically, their redemption and withdrawal cash flows, during the global financial crisis of 2007-08. This, combined with our own data, gave us the conclusion of the amount of continuous cash buffers that need to be in place to provide quick liquidity to investors.

In the event Bondora cannot fulfill all withdrawals from Go & Grow, there are two scenarios which will follow (and will be decided by whichever occurs first). We have simplified them into two short points below, however for a full description, please read section 7.6. of the Go & Grow Terms of Use.

  1. The investor will receive their full withdrawal once there’s enough money available in the Go & Grow portfolio, generated via further returns or deposits
  2. The investor will receive partial withdrawal once there’s enough balance available – paid out each banking day until the full withdrawal has been fulfilled.


It’s important for us to reiterate that the events described above are unlikely, but we want all Go & Grow investors to be aware of them and the action plans in place in case they occur.

Want to know more about Go & Grow? Click here.

*As with any investment, your capital is at risk, and the investments are not guaranteed. The yield is up to 6.75%. Before deciding to invest, please review our risk statement or consult with a financial advisor if necessary.

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