Investing with High Interest Rates
Interest rates on savings accounts are currently so low that they hardly generate any returns. With crowdfunding, a new world opens up for you with potentially higher interest rates. Through the Capital Circle crowdfunding platform, investors and entrepreneurs are brought together. Via this platform, it is possible to lend money to entrepreneurs in the SME sector in exchange for an attractive interest rate.
The interest you can receive through crowdfunding is often higher than the interest on your savings account. This is because crowdfunding connects investors with entrepreneurs who are looking for financing and are therefore willing to pay a higher interest rate. However, as an investor, you do run the risk that the entrepreneur may not be able to repay the loan. Therefore, it is important to carefully assess the financial situation of the entrepreneur before deciding to lend money via crowdfunding.
Crowdfunding can be an attractive alternative for investors seeking higher returns on their savings, but it obviously carries risks. However, through Capital Circle, you are assured of a recognized and reliable platform.
What is Crowdfunding?
Crowdfunding is a way to raise money by asking many people for small amounts. Instead of applying for a loan from a bank, the entrepreneur seeks investments from the public via a crowdfunding platform. People can decide to invest a small amount of money in the project presented on the platform. Thanks to contributions from many people, the financing can be quickly and easily collected.
Bank-Free Investing in Five Steps
Investing in crowdfunding, often referred to as "bank-free financing," at Capital Circle involves five steps:
1. Submit a Crowdfunding Project
Both entrepreneurs from existing businesses and startups have the opportunity to submit a project and offer it to the crowd via the Capital Circle platform. These projects have a minimum financing amount of €50,000 and a maximum of €5,000,000.
2. Risk Analysis by Capital Circle
Capital Circle conducts a thorough check on the application. Based on this check, it is determined whether the project offered by the entrepreneur is promising enough to be presented to you. The risks are also assessed, and the project is classified into a risk category.
3. Choose Your Desired Project
On our platform, you will find an overview of all crowdfunding projects. You can then choose which SME project you want to invest in. If you have any questions, you can ask them in the comment section of the project. You then choose a project you have confidence in, for example, based on the risk category and the interest rate. We advise you to invest in multiple projects to diversify the risk.
4. Invest with Attractive Interest Rates
Once you have found a project that suits your needs, you can start investing. The minimum investment amount is €100. To invest, you first need to create an account for identification purposes. You can then place your investments. At Capital Circle, you pay an annual fee of 1% on the actual outstanding funds (including VAT). This fee covers the monthly interest and repayment payments made by the entrepreneur through the Online Payment Platform’s Third-Party Account. The fee will be deducted from the monthly payments of interest and repayment.
5. Receive Your Returns Over Time
Entrepreneurs are required to repay your full investment, including returns, within 6 to 120 months. You will receive interest each month, and during (or by the end of) the term, you will also receive repayments. The interest rate can be up to 12% per year.
"At Capital Circle, we are here to provide you with more information about crowdfunding with higher interest rates. All your questions will be answered."
The Benefits of Investing with High Interest Rates
There are several benefits to investing with high interest rates at Capital Circle:
- Attractive Interest Rates: The interest rates Capital Circle offers can go up to 12% per year and are significantly higher than when you leave your money in the bank.
- Clear Risk: Only projects that Capital Circle has fully assessed according to European crowdfunding legislation are placed in a specific risk category. This reduces the risk you take as much as possible. The risks are also clearly outlined so that you are fully informed. Additionally, the project will only proceed once 90% of the target amount is reached. If this is not reached, you will get your money back immediately.
- Ability to Start Investing from €100: You can start investing from as little as €100, which is accessible for most private investors. Moreover, this makes it relatively easy to diversify your investments.
- Annual Fee of 1% on Outstanding Funds (Including VAT): Capital Circle charges a small annual fee on your outstanding funds to ensure the platform remains efficient and secure.
- Flexibility: You can decide which project to invest in and how much to invest. This allows you to spread the risk by investing in multiple projects.
Are you interested in exploring the possibilities of crowdfunding? But lack the general knowledge to start investing immediately? No problem. Our financial experts are here to provide you with more insights into crowdfunding and its interest rates.
The AFM (Dutch Authority for the Financial Markets) advises consumers to responsibly invest a portion of their wealth in crowdfunding and spread this over multiple projects. As a guideline, they recommend no more than 10% of your freely investable assets.
Interested in investing with high interest rates via Capital Circle? Contact Capital Circle today by emailing info@capitalcircle.nl or calling 015-7600019.