FAQs

In answer to any questions you may have...

Mutual Funds

 

Why is there such a limited amount of Mutual Funds to invest from?

Wealthfirst, Cube’s mutual fund advisor has done all of the hard work and research to shortlist a small set of the top performing funds from the 1,600+ available based on the following attributes:

  • How well the fund has done in the last 1, 3 and 5 years
  • How much risk the fund manager has taken
  • How stable these returns have been,
  • How large the fund is
  • How long the Fund manager has been in charge

Cube has then grouped these by the risk level you choose to take on. There are also a couple of international funds in addition. 

Does Cube hold my Mutual Funds?
No. The mutual funds are always held in your name with the fund house. Even if you stop using Cube, your funds remain unchanged. Cube makes it super-easy for you to choose proven performers, buy/sell and track your mutual fund investments. 

Can I invest in funds other than the ones listed? Can I track my existing Mutual Fund portfolio inside Cube?
Not at the moment. Cube’s goal is to take away the overhead of managing money and wealth from you.This is why we have done the hard work of picking funds that perform best in the risk level you choose, so that you don’t need to! 

Can I pick more than one risk category to invest in?
Yes! You can even invest in all categories at once as well. In your Mutual Fund preferences, set the percentages you want to allocate to each risk category (and the international funds). The next time you deposit money, Cube will automatically divide it that proportion between different funds. 

Can I move money between different risk categories?
Not directly from within Cube. You can of course withdraw money (fully or partially) from any fund into your bank account, and deposit into a new one. 

What if a fund does badly after I’ve invested in it?
Mutual Fund investments are of course subject to market risks, so the value will rise and fall on a day to day basis. Building wealth is a long term proposition, Cube strongly encourages you to give it time – a minimum of six months; ideally 2-3 years. 

I just bought a fund through Cube and have changed my mind and want to sell immediately.
Cube places no restrictions on when you can buy and sell your funds – you have complete control. However, when you buy a fund it takes up to three business days for the fund house to actually allot mutual fund units to you. Until then, your money will show as ‘under process’ on the Cube Magic dashboard and won’t be available for withdrawal. This is true of all mutual fund investments; not just specific to Cube. 

I’ve sold my fund, either fully or partially, but I don’t see the money in my bank account.
Just like with deposits, withdrawals (or ‘redemptions’) take between 2 and 3 business days to reach your bank account. These funds will also show as ‘under process’ on the Cube Magic dashboard. You’ll receive an email/sms from your bank and the fund house when the money is credited into your bank account. 

What do the mutual fund category names indicate?
The category names indicate the risk level of the mutual funds. Liquid funds are conservative funds whose returns are broadly stable. Debt funds have historically also provided stable returns & are spread across low risk fixed-interest products. They are slightly more volatile than liquid funds and offer correspondingly slightly higher returns. Moderate & Aggressive category funds are equity funds, the latter are both typically higher risk and offer higher returns than the former. Made in China and Americano offer exposure to the Chinese and US markets respectively and should be treated as high risk-high returns funds.

Equity Advisory

Do I transfer to Cube all the money that I plan to invest?
No. Purnartha, Cube’s Advisory partner, issues recommendations that you act upon using your existing brokerage. There is no transfer of funds other than the actual fees you pay to Purnartha. 

Why should I trust either Purnartha or Cube with such a large amount?
You should trust Purnartha’s track record. They have over INR 5800 crore under advisory for over 6000 Indian investors globally. Over 10 years, their annualised returns have been over 43.6%. They are also wealth advisors for Cube’s own senior management – we’ve literally put our money where our mouth is. 

How does Cube keep my portfolio updated if I act on my recommendations from outside of it?
At the end of any day during which you make equity buys and sells, your brokerage sends you contract notes (also known as trade notes or similar). You forward those contract notes to wealth@bankoncube.com. Your portfolio will be updated within 24 hours. 

How quickly should I act on the equity recommendations?
Purnartha, like Cube, builds wealth over the long term and picks only those equities that deliver consistent growth. In other words, the recommendations are infrequent, and are not time sensitive. You do not have to act upon them immediately. However, we do recommend you act as soon as you can, since in the short term the market can fluctuate. 

What if I buy more or less stock than recommended?
Purnartha ignores excess stock that you purchase. In case you buy less than recommended, Purnartha calculates your performance fee based on what you actually buy. However it’s in your interest to buy stock in the quantity Purnartha recommends, since you have already determined the amount under advisory when you signed up. 

Do I pay the entire management fee up front for a 1 or 3 year SIP, or every month?
The management fee is paid up front. You pay it either via a cheque or an NEFT transfer. Message Cube for payee/bank account details. 

How do I add to the amount of money that is already under advisory?
You fill out a new form for the excess amount, which also means new management fees. Tap the ‘Add Money’ button under your portfolio in Cube and follow the wizard. However, if you have cash on a regular basis to invest, consider a SIP plan.

P2P Lending

How does P2P lending work? 

  • P2P lending is an asset class where you loan money to people. Cube has a partnership with Faircent (www.faircent.com), a RBI licensed P2P NBFC (Non Banking Financial Company). Faircent is a marketplace that brings together investors such as yourself, and pre-vetted borrowers who wish to apply for a loan.
  • Based on your preferences, the money that you invest in Faircent is disbursed to borrowers. In return you receive monthly loan repayments over the tenure of the loan. The returns i.e. the interest rate on the loan depends on how risky Faircent evaluates the borrower to be (higher the returns, the risk).
  • A non-refundable 1% transaction fee from retail investors and 2% from institutional investors is charged on the loan amount disbursed. This is deducted from the first EMI.
  • P2P is an attractive asset class with returns between 12-28% depending on the borrower risk you choose. Making a loan also means you receive EMI repayments from your borrowers every month for the entire duration of the loan! Of course it also means that your investment is locked-in for the period of the loan, which is typically between 12-36 months.

Are P2P lending and Faircent regulated?
Yes, Peer to Peer lending in India is backed by the RBI’s robust regulatory guidelines from October 2017. These guidelines recognise P2P lending platforms as a new class of NBFCs (“NBFC – P2P”) and define the scope of permitted activities, minimum capital requirements and other key operational parameters. Faircent was the first P2P entity to receive its license from the RBI. 

What returns can I expect?
Returns are typically in the range of 12% to 28%. However, these depend entirely on the risk profile of the borrower. Borrowers with higher interest rates are also higher. 

What are Faircent’s fees?
Faircent earns only when you start earning.

  • A non-refundable 1% transaction fee from retail investors and 2% from institutional investors is charged on the loan amount disbursed. This is deducted from the first EMI.
  • There are no additional fees to invest in P2P lending through Cube.

I am already an investor/lender with Faircent. Do I need to sign up again?
No! You’ll see your entire Faircent portfolio within Cube, including investment you had made prior to Cube. You will though need to make an additional investment of INR 750 to activate your Faircent account in Cube (this is a Faircent requirement). This investment is then lent to borrowers just like your other investments in Faircent. 

Who makes the decision to lend?
Your P2P portfolio is created based on the risk category you select. Cube automates this for you by (1) asking for and setting your risk preferences, and then (2) making it super simple to invest in P2P lending regularly along with your other asset classes. Faircent assign the borrowers to your portfolio that match the risk category you have selected after they have completed their vetting process. This is what makes investing in P2P via Cube so simple because you don’t have to do all of the borrower selection yourself to have a diversified portfolio created. 

What does Faircent verify before listing a loan in the marketplace?
Faircent has a strict listing criteria for evaluating each and every borrower before they are allowed to be listed on the P2P platform. Faircent physically checks their office and residential addresses, it verifies their income statements, payment capabilities, past performance in order to understand their ability, stability and intent. Faircent evaluates each borrower on more than 120 criteria across 400 data points which includes Financial, Professional, Social and educational background, loan records, etc. to cherry pick only the most eligible borrowers for Lender’s perusal. All such information about each borrower is shared on the borrower listing page so that an informed decision can be taken by Lenders if you wish to view it. 

What is the minimum amount I can lend?
You’ll invest INR 30,000 or more to get started with P2P. We enforce diversification across a large group of borrowers to reduce your risk. Once you are up and running you can invest amounts as little as INR 5,000. The EMIs you receive are also auto-invested however you can change this on the Faircent website at any time. 

What are the risks I should know about? How does Faircent address them?
Once the screening of borrowers is done, every loan application received is given a Faircent risk rating. The risk category you choose for P2P lending in Cube are based on this rating. The risk rating is based on:

  • Stability: Stability is understood basis the nature of borrower’s residence i.e. rented/self-owned, length of stay at the same address, length of employment in the same organization etc.
  • Ability: Ability is evaluated by studying the borrower’s income & expenditure behaviour. For example, a healthy percentage of income saved reflects better ability of borrower to repay his/her financial liabilities.
  • Intention: Intention is understood by analysing the past repayment behaviour of the borrower towards their financial liabilities. Delayed repayments in past financial transactions reduce the chances of loan approval. For this purpose, bureau reports are procured (with prior consent from the borrower) and evaluated.
  • Banking Habit: A bank statement helps to judge banking habits of a borrower. Several parameters like average monthly balance, cheque bounce and unaccounted transactions, if any, are taken into consideration for assessment of a borrower’s credit worth.
  • Verification at different levels: Other than telephonic verification to get first-hand information from the borrowers, Faircent also undertakes physical verification at both the residence & office address. All documents submitted by the borrower are also verified for forgery using state-of-the-art technology.
  • Faircent Rule engine: This is an in-house algorithm that assigns different weightages to all the above factors to compute a score that helps determine the interest rate, loan tenure and amount at which the Borrower’s loan request can be listed on the platform to secure funding from the lenders.

How can I be certain that Faircent uses my funds only for lending to borrowers?
All your investments into Faircent are sent to your escrow account before being disbursed to borrowers. The funds in the escrow account are in your name, managed by an independent administrator, IDBI Trusteeship Services Limited (ITSL). Specifically:

  • Faircent has no right to intervene or option to withdraw monies for its own use from this account.
  • Lenders give instruction through Faircent to ITSL (IDBI Trusteeship Services Ltd.) who in turn will forward these instructions to ICICI for execution.
  • Faircent cannot do any transactions, only view the transactions done through this account.The trustee will independently audit the operations of this account on a regular basis.
  • A lender can withdraw money from the Escrow account anytime by simply writing to us and the money will be transferred to his bank account within 24 banking hours.

What is an escrow account? Why does Cube move money to my Faircent escrow account instead of just lending it to borrowers?
The amount you invest in Faircent is spread out over multiple borrowers in such a way as to match the risk profile that you have selected and create a diversified P2P portfolio for you. Therefore, they are disbursed as and when a borrower match is found, and when that borrower’s loan amount is fully funded by you and other lenders. This means your funds need a holding area during the time it takes to complete disbursement – that is your escrow account. Your loan repayments are also credited to your escrow account. 

Do I earn interest on my escrow account?
No. You don’t earn interest on the money that’s in your escrow account or during the period that you have committed money to a loan but it has not been completely funded by other investors yet. However, because you have set Faircent to auto-invest your money it spends as little time as possible in escrow. 

When do I start earning interest on my loans?
You begin earning interest when your loan is disbursed to the borrower. That is, when the loan amount is completely funded by you and other investors. 

How long does it take for my funds in escrow to be lent to borrowers?
It takes between 3 and 7 working days, but it depends heavily on the risk bucket you have chosen, the size of your investment and the set of borrowers available at the time. 

Where do I find my loan repayments?
Your loan repayments are all credited to your Faircent escrow account. As and when borrower profiles match your auto-invest preferences, the funds in your escrow account will be disbursed as fresh loans. However, you can withdraw the money that is in your escrow account at any time. You can also change your auto-invest settings on Faircent.com at any time. 

How can I withdraw the money in my escrow account?
You can find the option to Withdraw at the bottom of your Faircent Portfolio screen in the Cube app. 

What happens if a borrower delays a payment?

  • After the loan is disbursed, the Lender will receive EMIs on or before the 15th of every month. If a borrower fails to pay an EMI within a stipulated time, a penalty is levied on the borrower which is payable to the lender.
  • The first EMI is payable by cheque. Thereafter, repayments– EMI and pre-closure – are made through an online, automated procedure. Every month the entire EMI amount is collected directly (through auto-debit) from the borrower’s account to the Escrow account, from where it gets reflected in respective lenders virtual account.

What happens if Faircent shuts down?
Faircent has appointed an independent administrator, IDBI Trusteeship Services Limited (ITSL) to manage your (and other customers’) escrow account. In the event of Faircent’s assets being harmed or the company going into liquidation, this will not affect your money. This still belongs to you. For money that has been lent, ITSL will continue to receive re-payments from borrowers and distribute the collected payments to the lenders. 

Can I interact with my Faircent investments only through the Cube app?
Not at all – you can continue to access the full-featured Faircent experience at their website regardless of whether you use Cube or not. For example even though you’ve automated your Faircent P2P lending investments through Cube, you can log into your account on Faircent website and manually make a loan or withdrawal there. 

 

U.S. Equities

How do I invest in the U.S. market?

Once you create an account on Cube Wealth, our runner will visit your place with the LRS form. On submission & acceptance of form, your brokerage account will be created with clearing services firm DriveWealth. And the stocks mentioned on Cube Wealth will be allocated to your account.

How much can I invest in U.S. stocks from India?
The minimum amount for investment is $750. Currently, you can invest up to USD 250,000 every year in foreign stocks from India. This amount can change, subject to RBI guidelines. So, for now, your investments in US securities are also governed by the same limit. You can buy & sell stocks from the Cube Wealth app itself.

How many securities are available on Stockal?
Stockal offers nearly 3,400 securities – listed on NASDAQ and NYSE – as of now. These are a mix of stocks and ETFs (Exchange Traded Funds). Almost all the marquee listed companies in the US with USD Billion+ market caps, are available.

Where is my U.S. investing account held?
Your investing (brokerage) account is opened with our partner platform, Stockal and in the US your account is held with clearing services firm DriveWealth – regulated by FINRA and SEC. It is a licensed carrying and self-clearing broker offering brokerage services to global investors. DriveWealth is backed by Softbank Group and other leading venture capital firms in the financial services ecosystem.

What are the fees associated?
There are mainly 3 types of fees associated when you invest in U.S. Equities

  • LRS remittance fees (Charged by your bank when you transfer funds abroad)
  • Processing fees (Convenience +Annual brokerage fees + Tax Certificate charged in Cube app)
  • Withdrawal fees (A fee charged by the U.S. bank on withdrawal of amount from the U.S.)

How much time does it take to create an account?
It takes a couple of minutes to complete the onboarding details within Cube. You will also need to upload your address and ID proofs during this process. After which it takes 2-3 week for completion of LRS process & allocation of stocks to your account.

When will the shares be allocated?
Once you complete the initial process on Cube app, your account opening process initiates. The tentative timelines for the process are as follows:

  • In 2-3 business days, your account is created with our partner.
  • Once the account is created – a runner will visit you on the scheduled time with the LRS form for your signature and will submit the form to your bank.
  • After LRS form submission – it takes 10-15 days (depending on the bank) for the money to reach your brokerage account in the U.S.
  • Once the money reaches the brokerage account – the money is deployed in the shares selected by you.

What are the documents required for opening an account with Stockal?
Anyone of the following documents for a combination of Picture id proof + Proof of address (PAN + Aadhar/Utility Bill)

  • Personal details  
  • Bank details
  • Employer & financial details (required by stockal as per the compliance under FEMA and AML.)

How much can I reinvest?
The minimum amount you can reinvest after your first investment is $750

Is there a lock-in period and how long does it take to access my funds? 
No lock-in. Funds can be accessed in 5-6 business days.

How do I add funds to my account?
Just tap on the “Send” button available in the app. Enter the amount you want to send to your brokerage account. And post-completion of the LRS process the funds will be added to invest.

How do I withdraw money back to my account?
All you need to do is tap on the “Remit” button in the Cube App & the amount will be credited to your bank account. It takes 5-6 business days for the money to hit your account. 
There is a $35 fee associated with withdrawals, charged by the US bank, so the cash balance in your account should be at least $35 at the time of placing the withdrawal request.

Is there any tax deduction for my withdrawals or gains in the U.S. markets?
There is no TDS (Tax Deduction at Source) for your stock market gains in the US. So when you make money and send it back to your Indian bank account, the broker in the US does not deduct any tax on it. You will have to pay Short-term Capital Gains Tax OR Long-term Capital Gains Tax in India, whatever is applicable. Short-term Capital Gains apply if security is held for less than 12 months. For a detailed discussion, please contact our wealth expert.

Who owns the stocks?
You own the stocks through your account with Cube and Stockal’s partner – DriveWealth.

What happens if Stockal shuts down?
You global investing accounts are held by brokerage and clearing services providers. The custody of your account is managed by some of the largest banks and clearing firms in the world. If Stockal goes down, your account will still be safe and secure with them and you will be able to access it and/or move it to another brokerage firm as you please.

 

Does Cube give investing advice for U.S Equities?
Coming soon..

Receivables Financing - TradeCred

What is TradeCred Receivables Financing? How does it work?
TradeCred is a Trade Credit platform which enables cash flow for working capital needs of Businesses. Receivables Financing fills a gap for small businesses that are waiting for funds to settle on banking transactions (via credit/debit/ATM cards) made the day before.

  • Card based transactions in India (Credit/Debit/ATM) are “settled’ after a day, meaning that when a consumer withdraws money or swipes their card, money is deducted from their account on the same day. However, the receiver/payee/merchant gets the money on the next day.
  • This creates a perpetual working capital gap, which affects cash flows of the business.
  • TradeCred works with a registered payment intermediary/ aggregator who gives real time receivables to merchants/ATMs post which the the money is received by TradeCred in an escrow account the following day.

What risks are involved?
Like any trade transaction, there are following risks involved:

  • Counterparty risk involved – Counterparties in this case being banks whose card has being used.
  • Fraud risk – The transaction may be fraudulently originated.

In terms of actual empirical data on risks, TradeCred has facilitated over 350 crores of Receivables Financing till date with ZERO default and ZERO delays.
To mitigate these risks:

  • TradeCred does not fund any transaction more than INR 10,000.
  • TradeCred funds only maximum 90% of the total transaction volumes. Just to get a sense, overall fraud risk in the card payments system in India is less than 0.10%.

How is TradeCred regulated?
TradeCred is a platform, and not the beneficiary of the funds nor the owner of funds. 

Are merchants vetted before being loaned this money?
The payment aggregator who is registered with RBL Bank, who has been selected for Cube investors is:

  1. An Aadhar ATM operator
  2. Has PCI DSS certification
  3. Has undergone extensive Due Diligence by Audit Firm EY
  4. Has clean CIBIL score and track record
  5. Has tied up with 36,000+ sub agents
  6. Has seen transaction mismatch/failure rate of less than 0.10% since the last 12 months

Why don’t merchant’s borrow this money from the banks?
Banks fund working capital by calculating something called as Drawing Power. A lot of banks have stopped funding working capital below 15 days and more than 90 days. Receivables Financing is a perpetual 1 day working capital instrument. 

What returns can I expect? 
Currently, the returns are at 12.0% on an annualised basis subject to the terms & conditions of TradeCred & also based on the demand & supply of the product offering. If you invest 100 today, you will earn 112 at the end of the year. 

How much can I invest?
There is no limit. Minimum is INR 50,000. 

Is there a lock-in period and how long does it take to access my funds?
There is no lock-in. You can access the funds at a 3 day notice. Example: If you click on the ‘redeem’ button on the 46th day by 4 pm, you will get the funds back in your account on the 48th day by 12 pm. Returns will be calculated till the 47th day. 

What are the TradeCred fees?
All escrow charges, legal costs, TradeCred fees, GST on the above etc are deducted already. 12.0% will be the net cash flow return after deducting everything. 

Where does my money go when I invest?
Your money is transferred from your bank account to an escrow account that TradeCred opens in your name with ICICI Bank. From there, it is transferred to the payment aggregator who is registered as a Business Correspondent or Payment Intermediary with a Bank. The payment aggregator then transfers it to thousands of merchants/agents. 

What is an escrow account?
An escrow account secures the interest of the parties by creating a framework and taking cash flow away from the unilateral control of one party. This helps in mitigating the risk for the party whose money is at stake. TradeCred escrow bank is ICICI Bank. 

What documents do I need to sign?
A standard investor agreement is sent by TradeCred for you to sign that outlines the responsibility of each party. 

What happens if TradeCred shuts down?
The funds will be immediately returned back on the next day to all investors as the same will be immediately stopped from deployment. Without TradeCred process of transaction authentication on daily basis by 12.30 pm, the funds will not go back to the payment aggregators and will be given back to investors.

Ambit Capital Portfolio Management Services (PMS)

Do you have a model portfolio approach?
Yes. We use a model portfolio to make investments. 

Are there any deviations in the portfolio construction?
Generally, no. However, if a client cannot invest in one or more of our portfolio stocks due to constraints, we do provide an alternative replacement for that stock. 

How soon upon new fund infusion, the monies are invested in full in line with the model portfolio?
As soon as the client account is activated in the fund database. 

Do you take cash calls? What is the likely range of cash in the portfolio?
A specified range of cash (less than 5% of investment/portfolio amount) is usually kept as buffer for transaction fees, operational and other costs. Beyond that range the cash is invested in the portfolio. Cash calls will be taken in extreme circumstances (for e.g. if a current portfolio stock does not perform well and we may exit the position. In that case, a cash call would be taken only if a new replacement company stock is not available). 

What is the current sector-wise allocation?
As of December 2018,

  • Home Building Materials: 34%
  • Consumer Discretionary: 29%
  • Financials: 19%
  • Consumer Staples: 18%

What was the maximum drawdown in the portfolio in the last 5 years?
The maximum monthly drawdown has been -9.1%. The maximum overall drawdown has been -12.7% post fees, while for NIFTY it was -11.1% for the same period, ie Aug 2018 to Oct 2018. 

Number of stocks that you intend to invest in?
Between 10 and 15 stocks. 

What is the size of the investment team?
1 portfolio manager and 2 research analysts. 

What is the benchmark of the fund?
NIFTY 50. 

What has been the portfolio churn until now?
Till now the portfolio has had zero churn (no stocks exited since inception date). 

What is the intended churn of the portfolio?
We aim to keep the churn to a minimum level (less than 10% of the portfolio). 

What is the intended holding period of stocks?
We aim to invest for a period of 8 to 10 years. 

What are the fees and charges apart from management and performance fees?

  • Auditor’s fees: INR 1500 per annum
  • Brokerage: 0.1% per transaction
  • Demat charges: INR 600 per annum

Consumer Loans via Merchants

What is Consumer Loans via Merchants? Liquiloans is providing Zero Cost EMI Consumer loans to Prime Retail Individuals with a high credit rating (Avg. 700+ CIBIL score) for consuming Non-Fatal Discretionary Healthcare and Up-skilling Education programmes. These are offered through reputable healthcare and education partners that typically have a tenure of 3-18 months (Avg. 7-8 months). 

Prime Retail Lending is offered via Liquiloans and was founded by the highly credible and experienced ex-cofounders of Rentamojo. They are funded by Matrix Partners (Early Large Investors in Ola Cabs, Quikr, Treebo Hotels etc.) 
Liquiloans is amongst the few lending platforms to receive the Certificate of Registration (CoR) as an NBFC-P2P from the Reserve Bank of India (RBI).

How do Consumer Loans via Merchants work? Borrowers are provided with an option to take a Zero Cost EMI subvention loan when purchasing their discretionary healthcare or education programs from an approved provider. LiquiLoans allows them to make their payments in parts over time. A Borrower Loan Agreement is signed and a NACH mandate is set up to automate the monthly EMI payment.

What are the Liquiloans fees? Liquiloans doesn’t charge any upfront/ exit/ transaction fee to the lender. The entire fee of Liquiloans is earned only after the lender earns his / her hurdle rate as defined in the lender’s agreement.

How are the borrowers vetted? Borrowers are vetted through a proprietary algorithm which checks some or all of the following:

  1. The borrower’s credit profile (CIBIL / Credit Bureau Score & Re-payment track record)
  2. Social (Location, Age, Current Job Designation)
  3. Banking History This information is used to assess the suitability of the borrower

What risks are involved? What happens if a borrower defaults?

As with any type/form of lending, there are some risks, the biggest being that a borrower doesn’t repay. There is a risk that a borrower may default.  In case of default, Liquiloans uses a combination of soft and hard collections to collect missed payments on the lender’s behalf. Though the company has the best in class risk management systems in places, defaults may happen and Liquiloans minimizes the risk by ensuring that investment of each lender is diversified across a number of borrowers. In case of defaults, Liquiloans will facilitate the collection through its in-house collection mechanism and also send a legal notice on behalf of the lender to the borrower.

  1. Expenses incurred for sending legal notices, by recovery agency and towards other legal proceedings are borne by Liquiloans
  2. Liquiloans has already signed up with 2 Cash Collection Agencies to recover monies who then on Liquiloans behalf will try and reach out to the borrower and get back the outstanding funds. 

What returns should I expect? Lenders can expect a net pre-tax return varying from 10% to 11.50% XIRR Max. on the net invested amount. Liquiloans, however, does NOT guarantee any returns. In the past, Liquiloan’s Lenders/Investors have earned an average return up to 11-12% XIRR

Where does my money go when I invest? What is an escrow account? The amount you invest is spread out over multiple borrowers in such a way as to match the risk profile that you have selected. Loans are disbursed as and when a borrower match is found.  The borrower’s loan amount is fully funded by you and other Lenders. This means your funds need a holding area during the time it takes to complete disbursement – that is your escrow account. Your loan repayments are also credited to an escrow account.

What is the Lender’s Agreement? Why do I need to sign over Power of Attorney? Lenders agreement is a document which is signed by the lender and Liquiloans; where you agree to participate on the P2P platform subject to conditions and compliances required by the RBI. A Special Power of Attorney is taken to reduce the lender’s work and enables Liquiloans to assess borrowers, carry out requisite due diligence, sign the agreements with approved borrowers and disburse monies granularly to multiple borrowers & recover the same on behalf of the lender.

How is Consumer loans via merchants different to P2P direct to borrower lending? Consumer Loans via Merchants is essentially providing Zero Cost EMI consumer loans and the returns are made from the subvention.  In P2P direct to borrower (traditional P2P) lending, there is no subvention and personal loans are given to the end borrower’s bank account at high-very high interest rates.

How much can I loan? As per RBI guidelines of Oct 4, 2017, the following limits are applicable to any person lending on P2P platforms: i. You can maximum lend INR. 10 lakhs per PAN Card across all P2P lending platforms. ii. You can maximum fund INR. 50,000 per loan.

How much can I reinvest? The minimum amount you can reinvest after your first investment is INR 10,000

Is there a lock-in period and how long does it take to access my funds? No lock-in for the 11/11.5% scheme. Part or all funds can be accessed indicatively within 3 business days.

What happens if Liquiloans shuts down? As per RBI regulations, a trustee manages and operates the escrow account at all times. The trustee has access to all necessary data points such as the original borrower’s agreement and NACH mandates that allow them to take necessary steps to recover the funds on behalf of Lenders.

How safe is my money?

  • All borrowers approved by Liquiloans are curated through various data points and undergo stringent verification.
  • Monies lent at all points are routed directly through the Escrow (3rd Party) bank account and the same is managed by an Independent Trustee.
  • Most of the loans given have a defined end use through tie-ups with various service providers like health care/ educational institutes. In case of default, the service provider reserves the right to cancel the services.
  • The borrower agreement is a legally binding document and collections process is invoked to recover funds which will impact the borrowers’ high credit rating (CIBIL).
  • In case any borrower ends up defaulting even after the recovery process is initiated, Liquiloans earns no income till the lender makes his indicated return.
  • Thus, a lender/investor is safeguarded to a large extent and risk is minimized. Please read and understand Terms and Conditions before investing.

Gold

What is SafeGold?
SafeGold is an organised and transparent method of buying 24 carat gold in compliance with all applicable laws and regulations. SafeGold is neither a financial product nor a deposit but a method of purchasing gold as a personal investment. 

Who is SafeGold?
SafeGold is a product of Digital Gold India Private Limited, which is in turn institutionally owned by InVent Capital with the World Gold Council as a minority investor (through World Gold Council (India) Private Limited). 

What is the Purity of Gold offered by SafeGold?
Safegold offers 24 Karat Gold of 995 fineness (99.5% pure). 

How does this differ from a gold ETF that I can buy on a stock exchange?
With Safegold, the gold exists in physical form in your name with a trustee (in this case IDBI) and secured in a vault with a storage provider (Brink’s). What you see in Cube is the digital representation of this holding. This means you can order physical delivery of gold anytime and on as many occasions as you want, in multiples of 1 gram. When you buy, gold in grams up to 4 decimal places is credited to your Safegold account, which is what your gold portfolio in Cube shows. 

If it’s physical gold, why should I buy gold via Safegold instead of owning jewelry?
Buying and selling gold is vastly faster, simpler and more transparent with Safegold through the Cube app. If you’re buying gold as an investment instead of wearing it as jewelry, there’s no point to paying making charges as you would with a jeweler – instead, you’ll pay a nominal minting charge _only_ when you ask for gold to be delivered to you. 

What is the minimum & maximum amount for buying gold through Cube?
If you’re a new customer, the initial investment in gold through Cube is INR 15,000. The minimum subsequent investment is INR 50. 

How does Safegold keep my gold investment safe?
One, SafeGold has entered into a relationship with IDBI Trusteeship Services Limited to act as a Security Trustee for all our customers. The Security Trustee is entitled to act on your behalf and ensure that your interests are protected. The Security Trustee will have a charge on the gold associated with accumulations held by you.

Second, the secure storage provider (Brink’s) has a comprehensive, global insurance policy that includes the insurance cover on your gold stored in their vaults. In addition, SafeGold has an additional insurance policy to cover gold in transit. 

What happens if Safegold goes out of business?
The gold in your Safegold account is separate from the other assets of the SafeGold. The title of the gold clearly rests with you. The gold is held in trust by IDBI Trusteeship for and on your behalf. Any adverse event happening to Safegold will not affect the gold associated with the accumulations in your account. 

At what price is gold sold/bought from customers?
The buy and sell prices you see for gold within Cube are derived by Safegold from the wholesale bullion market plus a commission to cover operating costs. The actual purchase price paid by you will always be transparently published so that you have a chance to compare with all other sources before entering into a transaction. 

How do I sell my gold through Cube?
Tap ‘Sell’ on the bottom of your Gold portfolio under Settings -> Wealth -> Gold. You can choose to sell any amount starting with a minimum of Re. 1 to a maximum of the amount of gold that you own. You’ll see the sell price on the scree. The sell quote may be temporarily unavailable in the unlikely event of a disruption in the bullion market. 

Where can I find the invoice for the gold I buy and sell?
Safegold sends you an SMS on the mobile number registered with Cube, with a link to the PDF invoice after every buy or sell transaction. 

What is the maximum period of time for which my gold can be stored with SafeGold?
You can store your gold with SafeGold for a period of 7 years from the date of purchase. The custody shall be without charge for the first 24 months, and thereafter, will continue to be stored by SafeGold for a nominal fee to cover storage costs. You will be intimated in advance of being charged the fee, and will have the option to sell or request delivery of your gold at all times. 

What is the eligibility/criteria to purchase SafeGold through Cube?
Any Indian resident can invest in Gold through Cube. 

Is there any lock-in period for this plan?
No, there is no lock-in period from the date of purchase. 

Can I have a joint account for this plan?
No, you cannot have a joint account for SafeGold. 

What happens to my gold investment in the event of my death?
In the event of your death, if specifically allowed by SafeGold subject to the required due diligence, the title to your Gold lying in the vault and your account shall transfer to your legal heir. 

Goals

Where does Cube store the money I contribute towards goals?
All goal contributions are held in Reliance Liquid Fund in your name. The fund earns about 6.5% annually, compared to typically 3-4% in a bank account. 

This month I have less money to contribute than the total EMIs for all my goals.
No problem. By default Cube will allocate money towards EMIs for the goals that are most recently due. In that case the goals that are farthest away won’t see an EMI contribution for that month. Or with a single tap you can customise how you want to distribute your money among your goals. In either case, Cube will auto-adjust the EMIs accordingly. 

What happens to my money if I delete a goal that I have already contributed to?
The money stays in the liquid fund. The next time you run Manage My Money, Cube will re-allocate that towards other goals. Of course you can also withdraw that money into your bank account under Sell Mutual Funds. 

What happens to my money when a goal is complete?
Cube will notify you. You have the following options: (a) let the money remain in Cube in a liquid fund (continuing to earn about 6.5%) (b) keep the money in Cube but stop tracking the goal. That frees up the money for other goals (c) move the money back to your bank account. 

What happens when I change a goal?
You can change both the amount and the due date of the goal. Cube updates the % complete and the EMI appropriately so that you continue to be able to reach the goal in time. 

What happens if I reduce the goal amount to a number less than what I already have saved for? For example, I have saved INR 2 lakh already but I reduce the amount to INR 1.5 lakh.
The balance (INR 50,000 in this example) becomes available for other goals. You can also withdrawal it to your bank account from Sell Mutual Funds.

Where does Cube store the money I contribute towards goals?
All goal contributions are held in Reliance Liquid Fund in your name. The fund earns about 6.5% annually, compared to typically 3-4% in a bank account. 

This month I have less money to contribute than the total EMIs for all my goals.
No problem. By default Cube will allocate money towards EMIs for the goals that are most recently due. In that case the goals that are farthest away won’t see an EMI contribution for that month. Or with a single tap you can customise how you want to distribute your money among your goals. In either case, Cube will auto-adjust the EMIs accordingly. 

What happens to my money if I delete a goal that I have already contributed to?
The money stays in the liquid fund. The next time you run Manage My Money, Cube will re-allocate that towards other goals. Of course you can also withdraw that money into your bank account under Sell Mutual Funds. 

What happens to my money when a goal is complete?
Cube will notify you. You have the following options: (a) let the money remain in Cube in a liquid fund (continuing to earn about 6.5%) (b) keep the money in Cube but stop tracking the goal. That frees up the money for other goals (c) move the money back to your bank account. 

What happens when I change a goal?
You can change both the amount and the due date of the goal. Cube updates the % complete and the EMI appropriately so that you continue to be able to reach the goal in time. 

What happens if I reduce the goal amount to a number less than what I already have saved for? For example, I have saved INR 2 lakh already but I reduce the amount to INR 1.5 lakh.
The balance (INR 50,000 in this example) becomes available for other goals. You can also withdrawal it to your bank account from Sell Mutual Funds.

Expenses - salaries

How do I know when my domestic staff salaries have been credited into their account?

They’ll be notified by their bank. This is a regular NEFT bank transfer.

How do I see a history of my salary expenses paid?
Under Cube Settings, tap Move and then History. 

On any given day, how do I know what salary expenses are due?
Simply tap the Manage My Money button on the home screen. On the screen, tap ‘Expenses’ for a list of all bills due in the next ten days. 

What happens if I don’t have enough money in my bank account to pay my salary expenses that week?
You use your Cube Emergency Fund. When you started using expenses, Cube recommended that you leave at least two months’ worth of expenses in this Fund. This money is stored in a liquid fund in your name. If you don’t have enough money in your bank account to pay the bills due, Cube will liquidate the shortfall from the Emergency Fund. When the money is credited to your bank account, you’ll now have enough to pay your expenses. Cube will also help you remember to replenish your Emergency Fund the next time you run Manage My Money.