EasyEquities, South Africa’s largest retail investing platform, has launched securities-based lending, providing select clients with access to margin loans against qualifying investments.
- Democratizing access to equity-backed lending: EasyEquities aims to democratize securities-based lending, a service previously available only through private banking-type services. This move expands the pool of potential customers and brings more accessibility to this type of financing.
- Eligibility criteria and loan terms: The lending service is currently limited to portfolios that are diverse and liquid, with users who have demonstrated good investment behaviors being invited. Loans of up to R300,000 are available, with monthly interest payments and full repayment at the end of the 12-month term.
- High demand from users: On the first day of the launch, EasyEquities received over 100 expressions of interest from users who qualify for loans totaling over R5 million. The platform expects to gauge conversion rates and take-up by the end of the month.
- Collateral and security: Investors pledging a portion of their portfolio as collateral can secure the EasyCredit loans. EasyEquities on-pledges the qualifying securities to its third-party funder(s), ensuring the loans are secured.
- Qualifying securities and loan-to-value ratio: The loans are limited to 33% of the value of the investor’s qualifying securities, with an option for leeway up to an LTV of 48% if the value of the pledged securities decreases.
- Collaboration with Sanlam: EasyEquities plans to work with partner Sanlam to broaden access to the securities-based lending product, expanding its reach and potentially introducing new features and benefits.
EasyEquities’ launch of securities-based lending is set to disrupt the investment landscape, providing investors with new opportunities for leveraging their portfolios. This innovative offering aims to empower users and make investment financing more accessible than ever before.