Invest with confidence

We only allow NZ tax residents over 18 years of age to invest through our platform.

The Prevailing Interest Rates for each Investment Class and Investment Term are displayed on our Investor pages and currently range from 4.0% to 7.5%.  The interest rate you are presented with when creating your Investment Order on the Platform is the gross interest rate you will receive on your investment (unless a lower interest rate is accepted by the Investor), after any fees are deducted but before Resident Withholding Tax (RWT) is deducted.

The Prevailing Interest Rate is the current Investor interest rate applicable to an Investment Class and Investment Term.  It is set by us from time to time after consideration of the current market interest rates and Platform fees, levies and margins. The Prevailing Interest Rate will be displayed when an Investor places an Investment Order. Investors with open Investment Orders will receive at least five Business Days’ notice before a change to the Prevailing Interest Rate is applied.

There are two fees that can be charged to Investors:

Service Margin: We deduct a Service Margin from the gross interest payments made by the Borrower under their loan Agreement. Service Margins vary between Investment Classes and the risk grade of the borrower.

Please note however, that when you place an investment order, the Prevailing Interest Rate displayed is the net rate of return that you should expect to receive on that investment. The Service Margin and Reserve Levy have already been deducted at that point. The only deductions applied to the stated investment return from that point forward will be for Resident Withholding Tax (at a rate that you nominate) on the interest you are credited with once your investment order is matched to an approved borrower. 

Secondary Market Fees: This fee is charged to the Investor and deducted from the net proceeds from the transfer of a loan to another Investor in the event that an investment is sold on the Secondary Market. The fee is 1% of the loan balance transferred, up to a maximum of $50 per investment.

For a breakdown of our fees, check out our Fees page.

An Investment Class describes a group of loans written under the same (or fundamentally similar) credit policy and that have substantively similar underlying credit risks. Investment Classes currently available on the platform include: Home Loans, Business Property Loans and Personal Loans.

1. Fixed Interest means the interest rate applicable once the Investment Order has been matched and settled with a Loan will remain constant for the duration of the investment.
2. Variable Interest is essentially a floating rate. This means the interest rate applicable once the Investment Order has been matched and settled with a Loan is subject to change periodically during the term of the investment at our discretion. Variable Interest rates will be set by us from time to time after consideration of the current market interest rates and Platform fees, levies and margins. You will receive at least five Business Days’ notice by email before a change to the Variable Interest rate applies.

Our Secondary Market allows an Investor to sell an investment at any time provided there is another Investor willing to match the original terms of their investment (amount, term and interest rate). The option to sell your investment can be found at the bottom of the ‘Investments’ tab on your investor dashboard. We deduct a fee of 1% (up to a maximum of $50) from your investment balance when it is sold through the Secondary Market. Read more about the Secondary Market here.

On occasion, your Personal Loan Investment Order may be matched to an investment offered for transfer on the Secondary Market.  If the original investment received an interest rate above Prevailing Interest Rates, then if you have an Investment Order matched to that investment, you will receive the same interest rate that was received by the original investor in that Loan. It is therefore possible to receive a higher interest rate than the Prevailing Interest Rate. We will not auto match you to an offer in the Secondary Market with an interest rate below the Prevailing Interest Rate.

We will deduct Resident Withholding Tax (RWT) from your interest payments. This is paid to IRD on your behalf each month. At the end of the year, we will issue you with an IR15 certificate that you can use for your tax return. You can expect this by 20th May following the tax year-end.

For the Investor, the applicable Reserve Fund will attempt to cover the missed repayment. The ability of a Reserve Fund to cover arrears and defaults is reliant on there being sufficient funds available in that Reserve Fund. Find out more about how the Reserve Fund works under ‘How we manage risk’ or in the Reserve Fund Policy.

When the Borrower catches up with repayments, the arrears payments will be paid back into the applicable Reserve Fund until the arrears are cleared.

Borrowers are actively managed when they go into arrears on a loan. We’ll contact them initially to find out what’s happening and put a repayment plan in place if required. If a Borrower misses two payments consecutively and does not have a repayment plan agreed with us, or arrears are more than two months’ worth of repayments, then they may be referred to our external debt collections agency.

The short answer is no.

We've tried to minimise the risk as much as we can by putting in place a Reserve Fund for each Investment Class, we take out cyber and fraud insurance and employ strict lending criteria and we have robust system controls. We need to be clear however, the Reserve Fund is not an insurance policy and you should familiarise yourself with all of the risks of investing before making an investment. Find out more about how the Reserve Fund works under ‘How we manage risk’ or in the Reserve Fund Policy.

We model the expected life-time loss rate on Loans originated through our Platform under each Investment Class. We then align our reserve levies to ensure that we are reserving at levels adequate to cover the expected life-time loss rates. The reserve levy that is collected from each Borrower repayment is intended to exceed the expected credit losses over the life of our Loan book by circa 50% and ensure the Reserve Fund grows over time. We regularly review our reserve levy rates in the context of Loan book performance and each Reserve Fund balance to ensure we are collecting sufficient reserves to offset future credit losses. 

Whilst this does not guarantee your investment, the Reserve Fund provides a buffer to help protect investments from expected credit losses (and then some) and provide investors greater predictability of investment repayments. 

In the event that the Reserve Fund was to run down dramatically, we maintain the ability to divert up to 100% of future Investor interest payments (not capital) into the Reserve Fund to cover credit losses. This effectively means losses are socialised across all Investors in the Platform and helps protect the capital of all Investors.

Investor funds are held in an Independent Trust and do not form part of Squirrel’s business or assets. We rigorously check our Borrowers to ensure as best we can that they’re creditworthy. We have Reserve Funds to help cover expected credit losses and insurance to protect against acts of cyber-crime and fraud. In a nutshell, although we work hard to look after your money, we cannot guarantee your investment will be entirely protected in event of one or more unforeseen events.

The minimum amount you can specify when creating an Investment Order is $500. The maximum you can invest through our platform is $2 million. So, you’re free to invest any amount within that range.

Our Borrowers can borrow anywhere from $1,000 to $70,000 for Personal Loans (depending on the product) and up to $2 million for Personal Home Loans and Business Property Loans (depending on product and Borrower location, with a maximum of $1 million per security).

Your Investment Order may be split across multiple Loans or fully consumed by one Loan. Because we provide Reserve Funds to each Investment Class, you don’t need to spread your risk across multiple Loans as any losses that couldn’t be absorbed by the applicable Reserve Fund would be socialised across all Investors in that Investment Class proportionally if need be. Find out more about how the Reserve Fund works under ‘How we manage risk’ or in the Reserve Fund Policy.

Another thing to consider with larger Investment Orders is the Secondary Market. Investments sold on the Secondary Market currently require the whole investment to be transferred on a 1:1 basis i.e. a larger investment would likely be harder to sell. For example, to sell an investment of $70,000 on the Secondary Market, it will rely on another investor having an available Investment Order in the same Investment Class of at least $70,000 in value.

If the Prevailing Interest Rates have increased since your investment was matched, then the investment may also take longer for another Investor to accept your investment due to the lower interest rate offered.

So, if you intend on selling an investment at any stage, you should keep this in mind when creating your investment orders.

Squirrel receives bank transactions from its banking partner each morning for the previous day, so the system is always one day behind. We’re working on more regular updates, but that is still under development.

Home Loans & Business Property Loans: Loans are parcelled up into $500 portions. When a loan is available to be invested in, investment orders will be allocated immediately on a ‘first come, first served’ basis.

Personal Loans: New loans need to be 100% funded before any Investment Orders are allocated to them. For example, if a $10,000 loan requires funding and you have placed a $5,000 Investment Order, we would need other Investment Orders to make up the remaining $5,000 before your order can be matched to it. Once the loan is fully funded, your investment will become active.

Investor funds and Loans are held inside an Independent Trust and cannot be accessed by us in the event of Squirrel Money Limited failing.

In the event that Squirrel was placed into receivership (or the like), we have set aside sufficient funds by way of a bank bond (underwritten by our core banking partner) for the benefit of the Independent Trustee. This bond (plus access to the ongoing Service Margin on Loan repayments) is in place to ensure an appointed third party can continue to administer the collection of Borrower repayments and payments to Investors until such time as the Loan book is wound up. 

As part of our license we also maintain a disaster recovery and termination plan. In the event that the Platform ceases operation, any balances remaining in the Reserve Funds following repayment of all outstanding Loans and otherwise at the end of any managed wind-up process, will be donated to the Starship Foundation or such other charity having similar charitable purposes selected by the Trustee or any other person primarily responsible for the winding-up of the Platform.