What can I sell on the Monexo secondary market?
Any investment order on Monexo which is in current status and has remaining tenor more than 1 month can be sold on secondary market. Please note currently only lenders with minimum portfolio amount of Rs 5 lacs can list on investment order.
Why would I want to sell my Investment Orders?
The Monexo Secondary Market is a platform to provide liquidity to lenders by allowing them to directly sell (assign) their Investment Orders to other lenders. The Monexo Secondary Market is not intended to be a forum to speculate in the value of Investment Orders.
The maximum maturity on Investment Orders is 36 months and you should be prepared to hold any Investment Order through to its final maturity. However, should the need for liquidity arise, you may be able to use the Monexo Secondary Market to sell some or all of your Investment Orders.
How do I sell my existing Investment Orders on the Monexo Secondary Marketplace?
A seller (assigner) just needs to login into his Monexo account and visit "Loans to Sell" section. Seller (Assigner) needs to set the selling price for the Investment Order, accept the Terms & Condition and enter the OTP. It will be listed on Monexo Secondary Marketplace for 72 hours. As soon as there is buyer (assignee) purchases the Investment Order at the selling price, Investment Order is transferred to buyer (assignee).
Are there any restrictions on the sale of a Investment Order on the secondary market?
The following Investment Orders cannot be listed: 1. the loan status is overdue 2. remaining loan tenor is only 1 month or less.
Investment order listed on Monexo which could not be sold in 3 days can be listed again in marketplace.
Can I change the selling price once my Investment Order has been listed?
No, once listed the selling price of the Investment Order cannot be amended. Although if a sellers Investment Order listing has expired, he can relist the Investment Order at a different selling price
I had invested Rs. 10,000 in a loan 12 months back and now 8,000 is outstanding - can I sell part of this loan?
You cannot sell part of this Rs 8000. You need to sell the entire principal outstanding.
If I sell a loan at premium - how does it impact my returns?
You effective yield on the loan will be higher than the interest rate at which the borrower is being charged
How do I know which Investment Orders I should sell and how to price them?
Only you can decide which Investment Orders to sell. Monexo does not provide advice and recommends that you consult your financial advisor to ensure that any sale of Investment Order reflects your investment strategy.
There are many things you might consider before listing Investment Order for sale and deciding on the selling price, including the interest rate, the payments received, the remaining payments and term.
When should I sell a loan at a discount or at a premium?
When you decide to sell your investment in the secondary market, you can do it at a premium, par or discount.
Selling at par (0% discount/premium) means that an investment with a principal outstanding value and interest due of Rs 1000 will be available to other investors to purchase for Rs 1000.
Selling at premium (e.g. 5%) means that an investment with a principal outstanding value of Rs 1000 will be available to other investors to purchase for Rs 1050.
Possible situations in which selling and purchasing at a premium would be viable:
- The seller is looking to make a profit on sales of an investment;
- The buyer is willing to get exposure to the cash flows from a loan, and the premium paid is acceptable when looking at the forecasted return on the investment.
Selling at discount (e.g. 5%) means that an investment with an outstanding value of Rs 1000 will be available for purchase to other investors for Rs 950. Possible situations in which selling and purchasing at discount would be viable:
- The seller is looking to receive cash flows faster than according to the loan schedule;
- The seller is looking to exit an investment with delayed payments, while the buyer is ready to buy a loan with delayed payments.
How do I know my Investment Order is sold on the Monexo Secondary Marketplace?
As soon as buyer (assignee) purchases the Investment Order, both the buyer (assignee) and seller (assigner) are notified through email.
What if my Investment Orders do not sell?
Investment Orders can be listed for sale for up to 72 hours, after which your offer to sell will expire. If an Investment Order you have listed does not sell prior to its expiration date, you may re-list the Note for sale as many times as you like.
What is Yield to Maturity (YTM)?
Yield to Maturity (YTM) is the rate of return expected on a Investment Order held to maturity. The YTM calculation assumes:
a) The Investment Order is purchased at the listed price,
b) The Investment Order is held to maturity,
c) All payments are received in full and on schedule according to the original terms of the loan, and
d) Monexo collects its servicing fee.
YTM is only one means of assessing the potential value of a Investment Order and should be used in conjunction with other items such as loan status, payment history, Premium/Discount, etc. Because any loan may have a status other than “current” during its term, YTM is speculative and is provided merely as a point of reference and not as any type of investment advice, guidance or guarantee regarding the performance of a Investment Order.
What is the fee to sell the Investment Order on Monexo Secondary Marketplace?
Monexo charges 1% plus GST of the selling price to the seller.