Upon creating an Investor account on www.monestro.com, (hereinafter the Portal) administered by Monestro P2P OÜ, a company incorporated under the laws of Estonia, registry code 12651582 (hereinafter the Portal Administrator), the Investor acknowledges and accepts this Policy of the Reserve and future amendments hereto (hereinafter the Policy). All capitalised terms used in this Policy shall have the meaning as provided in the Portal Terms (as applied by the Portal Administrator at the time). If the Portal Terms contradict with this Policy, this Policy shall prevail.

Purpose

The Portal Administrator has voluntarily created a monetary reserve to reimburse, to the extent of available funds and subject to other conditions of this Policy, the Investors by acquiring their Claims in the event that any Loan Originator does not comply with its Buyback obligation (hereinafter the Reserve) and other conditions of this Policy are met. The Reserve does not guarantee recovery of the Investor’s investment in full or in part.

Contributions to the Reserve

The Portal Administrator makes monthly contributions to the Reserve from its own funds. The amount of contributions is determined by the Portal Administrator depending on the risk assessment. Typically, the monthly contribution to the Reserve is 0,35% – 0,55% of the outstanding principal amounts of all Claims.

Suspension of contributions to the Reserve

In case the amount in the Reserve exceeds 10% of the outstanding principal amounts of all Claims, the Portal Administrator is entitled suspend contributions to the Reserve. Contributions to the Reserve shall be reassumed in case the amount in the Reserve decreases below the abovementioned level. In addition, the Portal Administrator may suspend and reassume contributions to the Reserve at its discretion at any time.

The amount in the Reserve

The Portal Administrator publishes the amount in the Reserve on the Portal. The Portal Administrator updates the amount once a month (thus the actual amount in the Reserve may be somewhat different).

Using the Reserve

The Portal Administrator owns the funds in the Reserve and keeps the funds on a bank account opened in its name solely for the purpose of holding the Reserve. The Portal Administrator may use the funds in the Reserve:

1) to acquire the Claims from the Investors and make other pay-outs to investors in the event that any Loan Originator does not comply with its Buyback obligation and other conditions of this Policy are met;
2) to cover any bank fees related to the Reserve’s bank account (including transfer fees and account maintenance).

Acquisition of the Claims from the Investors

Without limiting the actions the Portal Administrator may take under the Assignment Agreement, Reassignment Agreement or the Portal Terms, the Portal Administrator shall use the funds in the Reserve to acquire Claims in case the following conditions are met:

1) the Loan Originator does not comply with its Buyback obligation in respect to the Claim within 3 months of moment when the Buyback obligation fell due;
2) the Loan Originator and the Portal Administrator have not agreed upon a deferred payment schedule for the payment of the Buyback price within 3 months of moment when the Buyback obligation fell due,
3) there are funds in the Reserve.

The price of purchasing the Claim is equal to the outstanding principal amount of the Claim (hereinafter the Pay-out). In case the Portal Administrator has assigned the Claim and the claims of the Investor arising from the Assignment Agreement or Reassignment Agreement (under which the Investor acquired the Claim) against the Loan Originator to a third party (on behalf of the Investor), the Pay-out shall be up to the difference between the amount the Investor received for the assignment and the outstanding principal amount of the Claim. In case the funds in the Reserve are insufficient to pay the full Pay-out for all Claims which became subject to the Buyback obligation at the same time, the amount payable to each respective Investor is calculated pro rata to the principal amount of the Claim held by each relevant Investor at the time. The relevant calculations are carried out by the Portal Administrator.

The Portal Administrator shall purchase the Claims in the same order as they became subject to the Buyback obligation, starting from the Claim which became subject to the Buyback obligation the earliest. In case the Portal Administrator makes a payment to the Investor’s Portal Account from the Reserve, the title to a corresponding portion of the Claim shall be automatically transferred to the Portal Administrator upon making the payment to the Investor’s Portal Account.

Risks

The Investor acknowledges and accepts that each payment from the Reserve reduces the amount of funds in the Reserve. The Portal Administrator does not guarantee that there are sufficient funds in the Reserve to pay the Pay-out to the Investor or to pay it in full.

The Investor understands and accepts the risk of default by the Borrower and the Loan Originator, as a result of which the Investor may not (fully) recover the Claim, the Buyback price or the Pay-out. In any event, the Portal Administrator shall not be liable for any loss deriving from the Claim or non-payment of the Buyback price or the Pay-out. The Portal Administrator has no obligation to repay to the Investor the Claim Price or the Buyback price nor any part of either.

The Reserve does not guarantee the Investor a payment each time the Investor suffers a loss as a result of the Loan Originator not complying with its Buyback obligation. The reserve does not constitute a guarantee from the Portal Administrator. Therefore, Investors should not rely on possible payments from the Reserve when considering whether or how much to invest.

Amendments to the Policy

The Portal Administrator may change this Policy at its full discretion at any time by disclosing the new policy on the Portal, including changing the pay-out rules.

Termination of the Reserve

The Portal Administrator may terminate the Reserve at its full discretion at any time. Any funds which are in the Reserve at the time the Reserve is terminated shall belong to the Portal Administrator.

Governing law and dispute resolution

This Policy and the legal relations arising herein are governed by the laws and regulations of the Republic of Estonia. Any disputes between the parties under this Policy shall be resolved at the Harju County Court.

Questions and complaints

In case of any questions, concerns, recommendations or complaints, please contact the Portal Administrator via info@monestro.com. Appropriate support or advice can also be obtained from the Estonian Consumer Protection and Technical Regulatory Authority or the European Consumer Centre Network (ECC-Net). ECC-Net is reachable from each European country.

This Reserve Policy was last updated on 03.04.2021.