Creditshelf & Exaloan: How digital SME lending adds value to an investor's asset mix
Frankfurt am Main, Germany, November 25, 2021 ‒ creditshelf Aktiengesellschaft, the leading financier for digital SME loans in Germany, and the data scientists at Exaloan AG confirm the added value of digital SME loans for the portfolios of institutional investors in a joint study.
Based on ECB data and the loan book of the creditshelf Loan Fund, the joint study elaborates the potential of the new asset class in the portfolio mix. Digital SME loans, such as those arranged by creditshelf’s lending platform, show a low correlation with other asset classes like equity, real estate, corporate or government bonds, and private equity. They are therefore ideally suited for further diversification of existing portfolios.
Dr. Tim Thabe, founding partner and CEO of creditshelf, explains: “We always knew that we are offering an attractive asset class for investors. Our new study with Exaloan officially confirms this. Especially companies of the German Mittelstand rarely have access to the capital markets and are therefore difficult to invest in by institutional investors. Through our platform, we offer a simple, digital and customizable way to invest directly into the German Mittelstand.”
In a volatility comparison, digital SME loans are significantly below other asset classes, even in comparison to a similar fixed income segment like corporate bonds. At the same time, they have much greater potential in terms of net returns. With the creditshelf Loan Fund portfolio, for example, the track record showed that investor returns amounted to up to 6% per year.
“We used bank lending data from the ECB to get a clearer picture of long-term return estimates for digital SME loans. When analyzing the data, we found that SME loans could be a great asset to include in an investor’s portfolio because they offer higher returns with a shorter duration than traditional fixed income securities like corporate bonds. By taking a close look at the creditshelf Loan Fund, we were able to validate our estimates with actual data. The study shows that institutional investors can benefit significantly from adding digital SME loans to their portfolio to enhance returns in a meaningful and stable way. Having the right tools to construct a diversified loan portfolio and control default risk is key, which is what our analytics engine is built for,” explains Luca Frignani, CEO and founding partner of Exaloan.
Exaloan is the leading technology provider for institutional investments in digital loans. Its mission is to close the global funding gap for individuals, entrepreneurs and SMEs by connecting institutional capital with digital lending platforms. By operating a global B2B marketplace, the company opens up digital lending as a new asset class.. As an independent agent and validator, Exaloan provides a fully digital investment infrastructure with a standardized risk assessment of each single loan through its Loansweeper™ platform. At the core of its business, Exaloan uses big data and predictive analytics to generate an independent real time credit analysis as well as dedicated insights and reporting for institutional investors, banks, and lending platform partners. Insights cover topics such as sustainability reporting, advanced portfolio analytics, and market research.
Behind Exaloan stands an experienced team with extensive know-how in the areas of quantitative portfolio management, capital markets, machine learning, and software development.
creditshelf is the leading financier for digital SME loans in Germany. Founded in 2014 and headquartered in Frankfurt am Main, the company arranges bank-independent, flexible financing solutions via a constantly growing network. creditshelf combines complementary needs: While SME entrepreneurs can easily access attractive financing alternatives, institutional investors can invest directly in German SMEs and partners can support their clients as innovative providers of new credit solutions. The core of creditshelf’s business model is a unique, data-driven risk analysis and unbureaucratic, fast and digital processes. Thereby, creditshelf covers the entire value chain: its platform is used to select suitable credit projects, analyze the creditworthiness of potential borrowers, and provide credit scoring as well as risk-adequate pricing. For these services creditshelf receives fees from both borrowers and investors.
creditshelf has been listed in the Prime Standard Segment of the Frankfurt Stock Exchange since 2018. The experts in the creditshelf team offer many years of experience in SME financing and are trusted partners and visionaries for the entrepreneurship of tomorrow.
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