At October, we have at heart to treat all our lenders, borrowers and partners equally wherever we operate. What does it mean for you ? As a lender the experience of investing is exactly the same if you lend to a French, a Spanish, a Dutch or an Italian company. It is the same platform, the same October Account, the same wallet / portfolio, the same taxation. This is absolutely unique thanks to our Tech.
Our mission is to create the Europe of Savings: allowing European lenders to invest directly in European companies . In this tutorial, we present you the investment rules depending of the country of origin and the size of the projects.
Investment limits per country
In order to protect individuals from investing amounts that could jeopardize their economic situation in case of capital loss, the law provides investment limits to be implemented by the crowdlending platforms. The crowdlending regulation differs from one country to the other, which results in different investment limits:
France 🇫🇷 and Italy 🇮🇹
- Retail lenders can lend up to €2,000 per project (this is a French limit imposed by the local regulator in order to push individuals to diversify their loan portfolio),
- There are no annual limits on the number of loans or on the amount lent.
The Netherlands 🇳🇱
- Retail lenders can lend up to €2,000 per project.
- The outstanding capital of any Dutch lender on the platform can never exceed €80,000 because of local regulation. As a Dutch lender you will be able to keep your outstanding capital at €80,000 by reinvesting your capital repayments in projects.
- Also if you are not a Dutch lender, your outstanding capital in Dutch projects can never exceed €80,000.
- Retail lenders can also lend up to €2,000 per project.
- There is a maximum amount that any lender can lend to Spanish projects per year. The maximum that you can lend per year to Spanish projects is €10,000. If you wish to invest above this annual limit of €10,000 in Spanish projects, you have to become an accredited lender. To become one, you have to:
- Provide a proof that your annual income is above €50,000 or that you have more than €100,000 in financial assets.
- Request the accredited lender status at [email protected] and complete an application form (only the first page in Spanish is to be completed, the second is an indicative translation).
For regulatory reasons we cannot open German projects to individuals. This is because BaFin (German Federal Financial Supervisory Authority) requires the use of a fronting bank to allow retail investment in loans. We have studied this possibility, which has been chosen by other platforms, but the additional constraints and costs make this an unacceptable alternative under our business model. German projects will only be funded by our institutional lenders (nor Spanish, Italian, French or Dutch retail lenders will be able to German projects).
We will continue to work hard, with our peers in the European Crowdfunding Network, to allow German lenders on the platform in the future. How? We are confident that regulation, particularly at European level, will evolve to enable you to support the growth of European companies.
Investment limits per project size
Projects of less than €100,000 are usually funded quickly. To enable the maximum number of lenders to participate in them and promote diversification, we apply an investment limit of €100 on projects of less than €100,000. For loans above €100,000 the limit is €2,000.
This limit has no impact on the distribution between institutional lenders and individual lenders. Institutional Investors will remain at 51%. The idea is not to increase this share, but to increase the number of private lenders.
As a reminder, institutional investors automatically lend 51% at the beginning of the project and then complete if there are not enough individual lenders.