The announcement text below was prepared by AS Mintos Marketplace (Mintos) in collaboration with Planet42, a cooperation partner of Mintos that offers investment opportunities on mintos.com.
Investors can now invest in loans backed by Planet42 (Inclusion South Africa (Pty) Ltd) rental agreements and earn up to 12% per annum.
Founded in Tallinn in 2017, Planet42 is a car subscription company that is on a mission to reduce transport inequality. It offers a rent-to-buy car subscription service, providing access to a personal car and a path to ownership for people who are otherwise locked out of traditional financing options.
Transport is an important facilitator of social inclusion and wellbeing – something that is often overlooked in developed countries, especially those with reliable and safe public transport options. But having a car means freedom in many developing parts of the world, and Planet42 is making this dream a reality for its clients.
It cooperates with hundreds of car dealerships across South Africa, meaning its clients have a diverse offering to choose from. With 8 000 clients to date, its primary target market is people who are overlooked or unfairly ignored by the traditional banking system in South Africa (read more about South Africa’s alternative lending market).
Planet42 recently raised USD 30 million of equity and debt from investors like Naspers and Lendable. The company now has more than 60 employees across Estonia, South Africa, and Mexico. Since its establishment, it’s issued 8 000 contracts valued at €38 million. With a current portfolio value of €30 million, Planet42’s default rate is 8%.
Planet42 car subscription agreements on Mintos
On Mintos, Planet42 provides investors with the opportunity to back its mission to democratize mobility in emerging markets by investing in loans backed by rental agreements.
Annual interest rates
12% EUR
Average APR (Annual Percentage Rate)1
50 – 80%
Average rent amount
4 500 EUR
Non-performing loans ratio (PAR 60)
9%
Average rental term2
30 months
Skin in the game
10%
Mintos Risk Score
7
Buyback obligation
Yes
Interest on delayed payments
No
1APR equivalent: This is the total cost to the customer assuming a 5-year annuity schedule, expressed as a percentage per year. Subscription payments are inclusive of comprehensive insurance and GPS tracking.
2Average rental term: Every agreement comes with a 60-month rental term, however, not all clients use the rental service for the whole duration of this term.
The Mintos Risk Score is 7, with subscores of 7 for subscription portfolio performance, 8 for subscription servicer efficiency, 6 for buyback strength, and 6 for cooperation structure.
Due to the inflexible evaluation frameworks and excessive risk averseness of South African banks, even people with stable incomes struggle to get access to finance. Therefore, Planet42 carries out risk assessments of its client using an automated scoring algorithm that can effectively detect who has been unfairly blacklisted and is, therefore, eligible for its offering. Planet42 also caters to customers with a limited credit history, also known as “thin file” customers.
To obtain exposure to Planet42 rental agreements, investors will be able to invest in loans issued by SIA Mintos Finance (a Mintos group company) to Planet42, where repayments depend on the renter’s payments. Each loan issued by Mintos Finance to Planet42 will be pegged to a respective rent agreement between Planet42 and the final renter of the car. A detailed description of this structure is available in the Mintos Finance loan agreement and assignment agreement.
In order to provide additional security to investors on Mintos, SIA Mintos Finance will enter into an arrangement with Planet42 and a security special purpose vehicle (SPV)*. The security SPV will hold the security (all receivables and special notarial bonds registered over the moveable equipment of Planet42) on behalf of Mintos and other lenders and will provide a guarantee as a security for any claims SIA Mintos Finance could have under the loan agreement between SIA Mintos Finance and Planet42.
*Bowwood And Main No 312 (Rf) Proprietary Limited
How to invest in Planet42 loans backed by rental agreements
Loans backed by Planet42 rental agreements will be added to the Diversified & Conservative strategies. If you want to invest in these with a custom automated strategy, make sure to adjust your strategy settings. If you’re investing manually, you can filter the loans on the Primary Market.
About Planet42
Founded in 2017, Planet42 is fighting transport inequality by putting cars in the hands of people unfairly ignored by banks in Mexico and South Africa. It offers a rent-to-buy subscription service, providing a path to car ownership for people who otherwise wouldn’t be able to have a car. Planet42 is making a social impact in many places where mobility is an issue, helping people move around South Africa quicker and safer. It works with hundreds of car dealerships across South Africa, meaning its clients have a diverse offering to choose from. It has been certified as a CarbonNeutral® company since 2021 by Natural Capital Partners, the leading experts on carbon neutrality and climate finance.
