Estateguru noted that a new law expands options for Estonian investors to use investment accounts for crowdfunding.
According to a blog post by Estateguru, the legislative amendment passed in the Estonian Parliament last week will now allow the “use of investment account funds for crowdfunding.”
This opens a new avenue for active investing, particularly for “small” investors, says Estateguru Chief Executive Officer Mihkel Stamm.
According to Mihkel Stamm, this change, which places crowdfunding alongside more traditional investment instruments, has been “long-awaited by many.”
Stamm added that this decision also reduces the pressure on investors “to manage their investments through private limited companies.” They also noted that it simplifies active investments in “various instruments with smaller sums, allowing investors to better manage the inherent risks of investing.”
He further explained that on the Estateguru platform, for instance, investments can start from “as little as €50, secured by a first-rank mortgage on the collateral property.”
He added that investment through an investment account is only possible via licensed crowdfunding platforms, of which there are currently two in Estonia.
Stamm explained that another update “providing flexibility and reducing risk for investors is the ability to deduct non-performing loans from taxable income in the future.”
He is confident that this legislative change will “encourage more people to invest and increase activity among current investors.”
Stamm believes these changes will “enhance the competitiveness of Estonia’s investment environment and make it more attractive internationally.”
He concluded:
“We have worked for a long time through Finance Estonia to develop regulations for crowdfunding and to ensure this solution is included in the investment account system. Now, these efforts have borne fruit.”
As covered last month, Estateguru had reported a “record” month with retail investors funding new projects worth 8 million Euros. In September of this year, investors on the Estateguru platform, which specializes in real estate-backed loans, funded new projects “totaling 8 million euros.”
