A while back I tested Fundaztic, a peer to peer platform. Recently I checked and found 5 default notes totalling RM806. I looked closely at the notes and found 1 A2 note to be at default.
For Fundaztic, the platform grades notes from A1-D8 where A1 being the most credit worthy. I was a bit surprise an A2 note can not only default but also default at such an early stage (2nd payment). The business of the A2 note is construction.
Well, lesson learnt, sometimes even grade A1-A2 notes also can default. I am now tweaking my strategy to be more careful and lend lower amounts even if it is A1 or A2 notes. I think also the issue is lending to construction companies carry high risk but there's no way I can exclude industries out because A1-A2 notes need to grab on the spot without having time to analyse the business. The particular A2 note that defaulted was loaned to a construction company.
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