Wowwo Q&A
This is a thread where you can ask your questions and write your Feedback about the Wowwo situation.
Dear Investors,
On December 17, 2021, we informed you that we made the decision to suspend loans originated by Wowwo from the Primary and Secondary Markets on Mintos until further notice.
The suspension is a cautionary measure to protect investor’s interests that is driven by macroeconomic changes which impact Turkish Lira exchange rate towards Euro. Given that Wowwo issues loans in Turkish Lira, but places them on Mintos in Euro, the company needs to pay the exchange rate difference from its own resources when forwarding borrower payments if Turkish Lira value drops.
As the Turkish Lira continued to depreciate rapidly, which could create a challenging environment for the company to meet its obligations towards investors on Mintos in a timely manner. We suspended Wowwo from the Primary and Secondary Markets.
Since then we shared also an update with you:
January 28, 2022
Dear Investors,
On Thursday, 27 January 2022, we had a meeting with Wowwo to further discuss possible solutions to the case of Wowwo's borrowers' repayments not being transferred to investors on Mintos. In the meantime, the funds due by Wowwo to Mintos and investors are moved to funds in recovery. The API communication system between Wowwo and Mintos was disconnected by the Turkish lending company due to currency risk that materialized for Wowwo as Lira continued to lose value against Euro.
In the most recent meeting, we exchanged information and proposals with the management of Wowwo, and we are planning to have a follow-up meeting next week when we will further discuss proposed options which will in the meantime be evaluated by both parties.
Mintos negotiations team is fully focused on coming to a resolution that will disrupt investors the least, as the case is currently classified “Stage 3”. You can find more about what this means in the article here:
https://www.mintos.com/blog/how-we-deal-with-loan-originator-issues-and-recovery-of-investor-funds/
As soon as we reach conclusions of value for investors and that can be publicly shared without disrupting our negotiation position, we won’t hesitate to update you immediately. In any case, we will share a more detailed follow-up after the upcoming meeting with Wowwo.
Please share your questions, thoughts and Feedback about Wowwo here.
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Please tell me how they can avoid paying?
This is not clearly a bankcruptcy, just their management made a decision not to make repayments (a big chutzpa if you ask me).
If they refuse, then court that enforces them to repay, but I think they will repay without court.
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Hello colleagues and Mintos representatives!
The situation with Wowwo shows how easily and quickly things can change. But life is life and when we make an investment we take a risk. Actually here is just one question, - when lending company will stop to pay?
As Mintos does not cover financial risks (and it is normal) the main role of organization is not to give possibility to invest, but - organizing fundraising events from partners who want to avoid their responsibilities.
For the mintos future can say, please, Promote Visibility! At least on your main duties!
1. The period of updates on recovery process is not acceptable. Please, make an, for instance weekly update about what was done, what is going on. If not, it looks like nobody is working on this.
2. It is not fare to show fake statistics. Funds "in recovery" is not counted as 60+ days or defaulted. They just disappeared from statistics and everything is very fine now.. But, fake statistics is very bad for reputation. I peref to have bad but correct data.
3. Nobody reply on e-mails in declared period. At least some formal reply (robot) can be better than nothing.I'm from Latvia and have a bit Mintos shares. It will be pleasure if the company copes with the functions it has taken on.
My oppinion, - do not wait too much with Wowwo. We need to get at least some money back and continue to work with still reliable partners.
Good luck, everyone!
Cheers!
Alex0 -
Personally, I am expecting 100 % recovery from Wowwo.
Their business is running as usual and they are making money. They just decided not to repay, they need to put in front of the court if they do not repay.
But of course, court is not a primary collection mechanism - only the last resort. As long as their business is going, they can repay.
They need to raise equity perhaps, look for Lira denominated funding etc.
Mintos is bragging that they are a regulated company. They have more responsibilities to also protect the interest of investors.
I think weekly reports are too frequent though.
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Dear Jarmo,
Trust me, everybody will prefer 100% but in last 2 months we received nothing.
The court, usually is a long process. If the owners of Wowwo decided to stop payments, they should already have some plan. Externally they will show everything is ok as long as possible. In the same time, they will withdraw funds out from the business. In a year, after the court, it will probably be nothing to take from them. If after year they will have "our" funds, the lira (according to the trend) will cost 30-40 lira per euro. And in the best case, in a year we will receive 50% of the frozen funds.
Kind regards,
Alex0 -
have you started selling loans in Russia?? mintos has no clue… war in the east and no warning at all to investors??
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What do you exactly mean by war?
I have not heard anything about war in the east.
I have not started to sell any of my Russian loans. I am not buying either though.
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i would be extremely cautious on Russia, Ukraine loans… besides the exchange risk (Russia currency will surely devaluate) the prevailing context will induce non repayment from debtors…
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How can they offer a good deal in a currency that is evaporating in value over time? If they offered bitcoins, I would consider accepting it, especially at these prices. But Liras? What do I even do with them? I have no Lira denominated bank account, the converting them into euros also costs etc.
I suggest to stay in the contract, make a settlement that they repay first the principal in timely installments, onc the principal is paid full, then they pay the interest. That is beneficial for both the investors and Wowwo and has 0 effect on cashflow of an investor.
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Dear Investors, the upcoming detailed update about funds in recovery on Mintos will be published already on 3 March 2022. We will give more details about Wowwo in this next update. Thank you for understanding!
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wasn't there an abdate for March 2nd, 2022???
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I have not seen the update, where can I find it?
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Clearly Mintos was incompentent in allowing such an entity to enter the platform. These guys clealry are criminals that took the oportunity given by the very poor Mintos due diligence procedures…its a complet mess…Mintos has only a well designed plataform , nothing more…their internal procedures and what happens in the backstage is a complete mess
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This news is the end of mintos. This company is broke with no transparency and no reputation. You have reacted late and badly, and always to the detriment of investors. Again.
My opinion is that you are going to go bankrupt this year.
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Mintos, this update is worrying. What do you mean 'not excluding legal action'? If Wowwo is not paying back even though the currency exchange is clearly more favorable than what they are willing to repay, legal action is the only next step.
As investors, we need to see now that Mintos takes a strong stance to truly protect our interests. The current actions are not good enough.
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In my opinion Mintos has failed its investors from multiple aspects:
- They included a risky LO in their Conservative strategy
- They did not inform investors properly of currency risk
- They included a risky country in their Conservative strategy
- They kept negotiating with a rouge LO for how long (months now) wasting investors' time and money
Now that the LO simply does not want to co-operate in good faith, the question is simple:
- Can Mintos fix this via legal actions, is the contract they have in place solid enough to execute money collection from the LO?
- If not, will Mintos stand up and take responsibility and repay the loss to its investors?
Again, I think the lastly mentioned action (taking full responsibility) is the only acceptable next step here from Mintos. You, Mintos, should recognize your error, reimburse the losses your investors/customers are suffering from now and after that you try to get your money back from your LO in Turkey (if you can).
I will wait and see if Mintos will do the right thing, 30 days more and no longer.
If not, I take my investments and leave the platform for good as in that case I have lost my trust in them.
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This is ridiculous. I bet there is a communication problem here. Your "negotiators" need to step their game up.
First off, there is no way wowwo actually offered to repay 25% over 33 months. This makes no sense. What does make sense though is that they offer to repay in turkish liras for the rate that was offered back in November, which as people pointed out is a 25% loss due to currency risk.
This offer may or may not be good depending on how the contract between Mintos and Wowwo was formulated but since they decided to just stop paying and not take you seriously, i think legally its probably in their favor. Not to mention that you show great impotence with your passivity during this whole time. Its a matter of time before all other institutes just stop paying you asewell
Second, the loss due to currency risk is nothing but your (Mintos) fault really. Your total risk evaluation was immensely incorrect. 1. You didnt disclose this properly to the market and 2. you put them in the "conservative strategy" category which was marketed as "a safer strategy that prioritizes risk reduction"
Lastly, take the deal. Offer immediate and full payback of Turkish lira equivalent as per november 2021 and get this over with. Because the alternative is going legal route and by the time you get anything back Turkish lira will have depreciated by double. And consider this a learning lesson
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Once again, we accept risk and loss non worry it's the game.
But if we loose THEY loose. Here they are just stealing money and making profit.
HOW CAN WE LOOSE DURING A LEGAL ACTION ?
Are you mintos agreement so bad ?
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Mintos, what are you going to do to regain the trust of your investors? Even more so than money, your business relies on trust and right now, your lack of decisive action and utter lack of communication are costing you dearly.
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In my opinion we cannot and will not accept anything less than payment in full. Meaning principal, interest and late payment fees. We must insist on a payment plan of 6 - 12 month and no longer than the car loans them self.
There are many reasons for this:
1) Exchange rate fluctuations is Wowwo's business risk. Not ours. They can hedge the risk. We cannot.
2) It sets a very dangerous precedents - if a lending company just can decide not to pay for whatever reason. I assume that the contracts in place does not allow such behaviour and that legal action has been taken. In my experience legal action does not benefit from letting time pass.
3) Wowwo has plenty of equity to take the exchange rate loss on their P&L for 2021 / 2022. It is not going to be a great year, I am sure, but that is the cost of doing business without proper financial hedging. I hope they will learn from that. I suppose the owners will ensure that going forward.
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It cannot be so that Wowwo tells how much they are going to repay without them going to bankcrupt because if they prevent bankcruptcy it looks like a fraud.
It is not the investors alone that should be penalized in this. We are not guilty for Wowwo not hedging the currency risk.
If we lose money in those LOs, it should mean also the equity holders of the company lose their equity. Bear in mind, we as Mintos investors are not equity holders.
In my opinion, the legal actions should start relatively soon if they refuse from repayments. It is not about to negotiate how much of the equity they repay and then they just continue business as usual.
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Dear Mintos,
I agree with many other here. Wowwo must repay in full, principal interest and penalties. This is how contracts and agreements work, and if one part does not act accordingly then legal action should follow.
Mintos business depends on investor trust, and we cannot invest if the LO agreements are not fulfilled. Any non-payment precedent will destroy investor trust.Don't get me wrong, I WANT to invest in Mintos, o love the platform format and understand MY end of the risk, but I need to trust the agreements.
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Fully agree with @DRIVE APS. A LO cannot arbitrary decide not to pay unless the company goes to bankrupcy, we accept loses in case they accept loses or the end of their business. Otherwise, it is totally unfair, Wowwo will keep making money and profit on our own loses. THIS IS NOT ACCEPTABLE. Two options: (1) Collaborative approach, repayment plan in full, first principal, later interests, we could accept lower interests in arrears in case they speed this process up, for the next months; (2) Non-collaborative approach, go into courts and trigger Wowwo bankrupcy. We will not accept loses if Wowwo and Mintos do not accept loses as well, negligence and risk should be allocated to all stakeholders, not only we investors. Mintos will be totally dead if they do not play fair for we all, I am deeply dissappointed on how Mintos works and their due diligence process, I will not keep using a platform that is not managed transparently, with a taste of amateurism. A good platform does not only mean a good app and sophisticated algorithmia, but something else, best market practices, clear governance principles and appropriate due diligences on the LO you are trading with. I am not that clear on Mintos' capabilities beyond their scripts, their app and algorithmia.
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You people seem to forget that interest does not accrue during the legal process, or at all once the loans end up in recovery. This has been stated by mintos. Depending on how long the legal process takes, financially it is much better to get 75% now than wait up to 2 years to get 100%. Firstly from the massive inflation that we are experiencing right now and secondly due to missed investment opportunities
Legal processes take time, alot of time, and by the end of it they will probably just establish a repayment plan which also takes time. Probably years
Personally i care very little about "principles" where "LO can just decide not to pay and get away with it". Im on this platform for money gain.
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@... important questions raised by investors remain unanswered.
-How did a LO that does not hedge its currency risk get allowed on Mintos? Mintos boasts doing its due diligence and having strict procedures before allowing LOs on its marketplace. So who was sleeping during this process?
-How did a LO that does not hedge its currency risk get awarded a risk score of 7?
-How did a LO that does not hedge its currency risk become part of Mintos conservative strategy?
All we get are empty promises from Mintos that they are negotiating and supposedly taking a strong stance, but Mintos is yet to acknowledge its serious negligence in this case which might very well cost Mintos' investors €20.000.000. As an investor I have watched this fiasco play out. Now there is a problem as well with Russian LOs being unable to pay even though several investors have said that these very same LOs are still paying on other platforms. None of this is doing my trust in Mintos any good. Without your investors' trust, you are nothing. What will Mintos do to regain investors' trust and make up for its negligence?
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Annija (Mintos), we would be grateful if you could specifically respond these three questions raised by our coinvestor @Petra Christina Zaagman. Beyond the Wowwo issue we are discussing here, these three questions require a quick response from Mintos - bearing in mind that a large proportion of Mintos' business cake comes from developing countries and former CIS countries with non-EUR currencies and severe internal instability issues. I am missing a total transparency on how risks are allocated among all the stakeholders (Mintos, LO, lending recipients and we investors, not only FX risks but all risks inherent to an investment). We have not been disclosed the broad picture on how it works (many of us did take major risks considering Mintos reputation - totally confident that good governance principles were applied). If we cannot estimate the risks we are accepting, 9-12% profit is totally meaningless, assuming that you can randomly lose more than 10% of your portfolio every 16 months, for instance (e.g. Wowoo, or other not-that-one-off events).
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Legal actions are now necessary. And if the owners have hidden money, then fraud investigations and seizing the assets of the owners/people behind.
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I don't think it could be any clearer. The Mintos strategy is negligent or a deliberate trickery of its investors to motivate them to invest in loans that we would not otherwise choose.Is it time to think about legal action against Mintos? There is much to clarify here.1
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I agree - legal action against Mintos should follow if we get nothing. As i mentioned b4, Wowwo took chance of the very poor and negligent Mintos’ due diligence procedures. We cannot forget they give loans to buy cars - so for me it makes no sense for them no being able to pay - the hard asset, the vehicle value has increased in Lira and kept the same in euros or even increased due to the scarcity of new vehicles in the market. I suggest all Wowwo defrauded investors get together and jointly address Mintos legal counsel.
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Dear my coinvestors. Fully agree on what you are suggesting RE legal actions to be taken. I work on the M&A industry (my daily duties are delivering technical & commercial due diligence for clients in relation to potential investments in the infra sector) and I am totally embarrased of myself for taking best practices for granted here at Mintos. I decided to invest based on Mintos' strategies and their good reputation so far (I accept my own responsibility on that, for sure), but at that time all risks were not disclosed clearly to investors. Not sure what word I should use in this case, namely (1) Misleading adverstising (Mintos scores, for instance), (2) Negligence (clear rules to take part of this platform, like hedging), (3) Fraud (Non-payments should trigger a LO default declaration, otherwise we are being fooled).
I would encourage our colleage Annija from Mintos to come back to us with clear responses at their earliest convenience to the points addressed earlier.
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Hi mintos,
I would like to ask who is responsible for monitoring inflation and currency exchange for country where mintos provides our money (yes we can change countries in strategy, but it is almost impossible to check it by everyone by himself). -> it should be monitored by application in daily basis....
I would suggest you to check those parameters to prevent situations such as this.
As I am understanding what is happening in Turkey, there is no possible way how they repay us the loans... They have lot of issues of their own..
Exchange currency falling for long time... https://www.ecb.europa.eu/stats/policy_and_exchange_rates/euro_reference_exchange_rates/html/eurofxref-graph-try.en.html
Inflation over 50%!!!! this month
https://tradingeconomics.com/turkey/inflation-cpi#:~:text=On%20a%20monthly%20basis%2C%20consumer%20prices%20surged%2011.1%25.&text=Turkey's%20consumer%20price%20inflation%20jumped,market%20expectations%20of%2030.6%20percent.
Basically their whole economy is falling, with wrong decision of central bank (low rates) and possible by Russia-Ukraine war.
So my question again: Does anybody monitor country status which we provide our money?? (I know war could not be predicted at least not so easy, but with inflation and rates it could be done very very easy...)
To other investors:
Do not bother to think you will get all of your money back. We will be happy to get at least something ( max 50% 5-10 years horizont, without any interests...)
I "invest" (lost) 15% of my portofilio in Turkey.... (More than 1 year investing gone.....)0
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