“Our business loan portfolio includes hundreds of small companies,” said Sten Tikk, member of the management board of Nordic Hypo AS. “Our clients include construction and real estate businesses, agricultural producers, retail companies, as well as various service providers.”
“We approach our clients on a personalised basis, and the decision process for granting a loan takes place within a day,” says Heikki Rannik, member of the management board of Nordic Hypo. “For larger financiers, this can take one to two weeks. But a merchant who needs funds to stock up on goods tomorrow cannot wait two weeks. We can find a quick solution for such cases.”
Nordic Hypo’s clients include many agricultural producers with seasonal incomes. “They turn to us because we can offer a personalised approach and recognise that farmers’ incomes are seasonal,” Tikk explains. “Banks, on the other hand, want to see a steady revenue stream.
If you need money for spring planting, it is not worth selling off your land, as its value will increase over time. You can take out a loan against the land if necessary.”
“Banks tend to expect you to already be wealthy while Nordic Hypo is fast and flexible, and we can negotiate repayment terms,” says Regina Aru, owner of construction and renovation company Starplex OÜ, explaining why they have taken out three loans from Nordic Hypo over the past two years. The owner of the construction company admitted that Nordic Hypo offers somewhat higher interest rates than banks, but speed and convenience take priority for her company, as does the ability to take on larger projects.
Nordic Hypo offers flexible loan interest rates depending on the loan period and amount. “We currently operate with annual loan interest rates of 13–17%,” says Tikk. “Business loans are generally for a year or two.” Rannik recommends doing a background check when choosing a financial partner. Just as lenders usually conduct background checks on both the company and its owner, borrowers should do the same and determine whether the lender is a licensed financial institution and how long it has been operating.
Nordic Hypo AS received authorisation from the Estonian Financial Supervision Authority to operate as a mortgage creditor in March 2016. A mortgage loan, or real estate loan, is a loan collateralised by real estate, such as an apartment, house, summer cottage, land, farmland or forest. Mortgage loans are more flexible than other loan products both in terms of conditions and choice of use. Nordic Hypo was founded in 2014, but its team members already have 20 years of experience in the financial services market. Business loans account for 35% of Nordic Hypo’s portfolio and this number is growing at a steady rate.