EstateGuru partners with Varengold Bank to innovate the alternative lending industry in Germany

EstateGuru, the European leader in alternative property  lending, and Varengold Bank, the bank for the marketplace lending industry, have signed  a term sheet for a fronting service agreement. As part of the upcoming accord, Varengold  Bank will provide a regulatory umbrella to enable the launch of EstateGuru’s full-service  package in Germany. 

EstateGuru is the leading Pan-European marketplace facilitating property-backed loans  for small and medium sized enterprises. Through its platform, private and institutional  investors can invest in carefully selected projects backed by first-rank mortgages, starting  from as little as 50 euros. Founded in 2013, EstateGuru today offers investments in 8  countries, has facilitated more than 263 million euros worth of loans and rewarded its  64,000 investors with more than 20 million euros in interest payments as of November 16,  2020. Following the upcoming signing of the fronting service agreement with Varengold  Bank, EstateGuru will offer its full range of services to all borrowers and investors based  in Germany.  

“Geographic expansion is one of the three key development areas that will empower us to  deliver on our long-term strategy to finance 5 billion euros annually by 2025. The other  two being technology and institutional investors. Germany has been on our radar for quite  some time. Our biggest community of 19,000 private investors comes from here. So, it is  a logical step to become a proper member of the alternative finance industry in Germany.  To be fully compliant with the regulatory environment in Germany, we need to have a  fronting service cooperation with a local bank. As Varengold Bank is already a valued  long-term partner and first-class service provider for fintechs, we have decided to ensure compliance by partnering with them”, says Marek Pärtel, co-founder and CEO of  EstateGuru.  

“When it comes to financial services, Germany is a heavily regulated market. Foreign  fintechs tend to underestimate the bureaucratic hurdles until they experience them  firsthand. EstateGuru has decided to address this challenge by making use of the  regulatory umbrella we can provide thanks to our full banking license. It is a perfect  example of how fronting services enable the entry of companies with business models  that bring innovation, new technology and agility to the German market – to the ultimate  benefit of all market participants. We are happy to contribute our share to market  development and proud to have the opportunity to exhibit our fronting expertise as part of  an expansion of our existing partnership with this Estonian fintech powerhouse”, adds Lukas Diehl, Executive Vice President and Head of Marketplace Banking of Varengold Bank.