Before you invest

Modena Estonia OÜ (“Modena”) sells you claims arising from its own loans and Buy Now, Pay Later agreements through modena.capital. Your return comes from the performance of the claims you have bought i.e. it depends on borrowers repaying them and on Modena meeting its own obligations to you.

This statement sets out the main risks for your capital and what Modena does about them. As with any investment there are measures in place to reduce the risk but they can never be completely removed.

1. Your return is not guaranteed

The risk. Figures shown on the website, such as average past returns, describe the past. Your actual return depends on the performance of the claims you buy, how often your money is reinvested etc.

What it means for you. You may earn less than the figures shown, and in a severe scenario you may lose capital. Calculators and examples on the website are illustrations, not guarantees.

What Modena does. Modena shows real-time returns (incl. XIRR) in your account so that you can have an update-to-date overview on how your assets are performing.

2. Borrowers may default or pay late

The risk. Your claims are towards consumers and entities who borrowed from Modena or used its Buy Now, Pay Later service. Some will pay late or not in full.

What it means for you. Missed payments reduce what your claims are worth and lower the overall yield on your investments.

What Modena does.

• Modena checks thoroughly each borrower’s credit history, income and existing debts before lending.
• Modena encourages investors to invest across many claims, so one borrower stopping payment has a limited effect.
• Modena contacts late payers and, if needed, starts the debt collection process or passes the debt to collection or the courts.

3. You may not get your money out immediately when you request

The risk. A withdrawal request is a request for Modena to buy back the assets that you own. It is not an instant transfer and happens only at Modena’s discretion.

What it means for you. Withdrawals requests cannot be guaranteed. If many users request withdrawal at once or there is some other deciding factor, Modena might not buy back the assets even when requested. In those rare cases the withdrawals could be delayed and/or repayment is tied only with the payments of the underlying assets.

What Modena does. Modena monitors liquidity based on historical data, payment patterns and many other important KPIs. Modena always keeps a healthy cash buffer and utilizes multiple sources of financing to ensure the proper solvency of the company.

5. Modena could fail

The risk. Modena lends, sells you the claims, services and collects the loans and runs the platform. If Modena becomes insolvent or stops operating, all of these processes can be interrupted or stopped.

What it means for you. Repayments and withdrawals could be delayed or stopped. Recoveries may be lower while responsibilities are transferred or insolvency proceedings are ongoing.

What Modena does.

• Modena publishes audited annual reports and is subject to rigorous financial reporting to the local FSA.
• Managing Modena’s liquidity and P&L is a daily task whole team is responsible for.
• Claims you have bought are yours and are not Modena’s assets. They belong only to you and are not part of any theoretical bankruptcy estate.
• Borrowers still owe the money even if Modena fails; servicing can be transferred to another company.

8. No deposit guarantee or investor compensation

The risk. Modena Estonia OÜ holds a consumer credit licence from the Estonian Financial Supervision and Resolution Authority. That licence covers Modena’s lending to consumers. It does not cover modena.capital as an investment, and it does not protect investors. modena.capital is not a bank deposit or a licensed investment service.

What it means for you. No deposit guarantee or investor compensation scheme will repay your losses.

What Modena does. The measures in this statement reduce risk but create no right to compensation.

9. The bank holding your uninvested money could fail

The risk. Money you have not yet invested, and money waiting to be paid out, is held at AS LHV Pank, in an dedicated account used only in the context of this platform. Banks can fail.

What it means for you. Access to that money could be disrupted and part of it lost. This affects only cash, not your claims.

What Modena does. Modena holds client money only at a respectable and licensed EU bank and monitors closely any risks that might arise from any financial counterparty involved with this platform. The funds kept on the bank account are only temporarily uninvested funds, so it is a small part of the overall assets.

10. Taxes

The risk. Income from modena.capital is taxable. How depends on the law of your country and your situation. Modena does not give tax advice.

What it means for you. You are responsible for declaring and paying tax, and tax reduces what you keep. Rules can change.

What Modena does. Your account includes a financial income report. If unsure, ask a tax adviser.

Invest only money you can afford to lose and do not need at short notice. Spread your savings across different kinds of investments. If anything in this statement is unclear, contact Modena at info@modena.capital before investing.