Topic: Loan to a startup business ->>> high risk :: 36% annual interest rate (Read 2958 times)

It's what a good NCR machine costs.  They start at 30k.  It is necessary so that the user can make a cash deposit or a debit card deposit.  The nice thing is they hold their value well.  Fwiw this initial loan request is not for the actual machine but just for the initial start up funding.

a $40,000 atm machine. hmm....seems a little expensive. good luck.

Had another commitment from aprspecfive lender today, thanks!

Thank you swordv2 for your commitment to fund.  We are now 10% of the way toward our goal.

https://btcjam.com/listings/6769

+1

Even the guy with greate reputation here had injured us, it's hard to trust you with few activities.

Thy,

I am from Colorado and I have done all I can with BTCJam.  I have verified myself and done everything except attach my credit score.  I am not fond of the notion if giving a Brazilian company my personal social security number and the company we are forming does not have a social security number. 

The only way to improve my score an further is to develop a reputation at BTCJam.

So I suppose I'll need to do as so many others have done and borrow tiny amounts until I have a reputation on the site.

Just stick to the basic rules.
Newbie, no collateral, no loan.

Both here on bitcointalk and on BTCjam you say "...the maximum loan amount..." i guess you mean the highest interest your allowed to pay, but 45% annual interest doesn't translate to 3,00% monthly.
On BTCjam you have requested a loan for 180 days, the avg time the money is loaned is 3,5 months, if it would have been a 1 month loan the max allowed(if there really is such limit for this type of loan) interest had been 3,13% and on that 3,5 month loan on BTCjam it translates to a maximum of 3,27% monthly interest if you compound the interest, if the 45% is not calculated compounded in the USA then the max is 3,75% monthly of course.

Without having read the us laws on the subject i seriously doubt thou that it's illegal for a borrower to offer higher than 45% yearly interest, but rather that it might be illegal for loancompanys/private persons to charge rates above it.
Also even if 45% would be the limit there's always the possibility for company's to work around it by calling it a fee instead of interest so it is still possible that they can charge higher yearly interests, just look at Visa/MasterCard/PayPal and similar company's, all charge fee's in the percent ranges on transactions that is almost instantly or at max shouldn't take more than a day or so...


You say "In Colorado the maximum loan amount we can pay is limited by the state. We are allowed to pay 3% per month."

Sounds more like your trying to say "In USA the maximum interest you are allowed to charge is depending on what state your company are located/registered in. We are allowed to pay slightly over 3% per month as we're in Denver, Colorado."

On BTCjam you haven't verified your Credit score, not your PayPal account either or any Social Networks and you haven't linked your bitcointalk account to the account on BTCjam.
You have the second lowest score of the 55 loans there at the moments, only a person with 3 active loans hiding behind TOR, offering 50% interest on his 4th loan attempt and that probably never will pay back his loan has lower score than you....
If you want to have any chance in getting a loan at BTCjam of any significant size i suggest you solve those things first.
With the only known info about you is that you have a 28 day old bitcointalk account and that you want to loan 50 000+ USD starting with a 50 BTC loan you probably have little chance of getting the loan.

I could be wrong, but why do i get the feeling that your not from USA at all....

with this all your work peoples and authorities in Colorado may be satisfied but peoples here on bitcointalk never so you must have some collateral otherwise they will do postmartym of your id and you must be in red very soon so very careful about this   

I'm sorry if I implied it didn't.  (I edited the post you quoted in an effort to clarify).


I believe, due to Federal requirements, that any person who buys a bitcoin from our machine will be required to provide some type of personally identifiable information.  As proof of identity we hope to be able to accept:  


1) Biometric scans (retina, fingerprint, image of face)

-or-

2) Standard information you might provide a bank such as name & social security number.


If a person wants to purchase more than $300 in a single day we will, probably, require additional information and may even force the user to create an account with us.


Understand that our model is not complete and if our lawyers tell me this is incorrect we will bow to their wisdom.  In fact, that is exactly the reason we intend to employ so many lawyers.  Bitcoin related issues are challenging as there are no laws in place that govern them specifically.  All we have is guidance from various governmental bodies and so we need brilliant counsel to keep us from breaking any known laws.

  This is completely incorrect. KYC requirements for exchanges of convertible virtual currencies start at dollar number 1.       

Okay, so you guys have quite a bit of work cut out for you.

You should write up an FAQ so you don't get asked the same questions over and over. I'll probably be back with more questions later. tired

Unfortunately the SEC is dragging their feet on the crowdfunding.  "September 24, 2013 marks the first stage of implementation of the JOBS Act, with the regulations allowing a general solicitation by companies wishing to raise money, provided that they accept investments only from “accredited” investors (people with investible net worth of $1 million or meeting other criteria)."

http://www.forbes.com/sites/devinthorpe/2013/09/06/expert-talks-about-investment-crowdfunding/


>Okay, I am seeing a better picture now although I certainly have doubts you would
>be able to deliver such a return from your business' profits in reasonable amount of time.

There is no question the business will not turn any profit for some time.  As I mention in the lending post I am covering the interest from my personal finances.


>Do you have relationships with manufacturers? You seem to have someone who
>can write the software for the ATM, but what about to design the hardware?

We are seeking hardware partners.  This is one group we are reaching out to:

http://www.cartaworldwide.com

http://www.cartaworldwide.com/company/news/article/115/carta-demonstrates-world-first-on-demand-emv-issuance-at-cartes-2011/

Oh, is it not the passage of this title: http://thomas.loc.gov/cgi-bin/query/z?c112:H.R.2930: (first one) which allows for unaccredited investors?

I may be confused. edit: nm, you're right.



Okay, I am seeing a better picture now although I certainly have doubts you would be able to deliver such a return from your business' profits in reasonable amount of time. Do you have relationships with manufacturers? You seem to have someone who can write the software for the ATM, but what about to design the hardware? This is a long and arduous process, or do you have some special relationships you haven't mentioned?

We are in Colorado, not NY or California.  The bond will only be a tiny percent of the amount of money we expect to deal with.  In short, it will only be a couple thousand dollars per year.

We will most likely be engaging Holme, Roberts & Owen in Denver as they are experts in Colorado banking laws.  In addition I am a long term client of PELINO & LENTZ, now ARCHER & GREINER, PELINO & LENTZ a world class IP law firm on the east coast.  We also intend to employ MSantori if he is available.

Yes, as required by law, we will develop a complete compliance program.


>Why couldn't you just wait the rest of the month and open a security when the laws are passed?
The September 23 exception only applies to accredited investors.  That is not truly crowdfunding.

>How did you come up with this 36% yearly ROI number?
As I said Usury is at 45% in Colorado.  Based upon the other offers on BTCJam I felt 3% per month was an appropriately high offer for this first unsecured loan.  Don't expect future loans to pay that well, this is a business not a charity.  ;-)

Sure, but you didn't answer the question about the surety bond. Have you hired lawyers? Have you written a risk assessment? A compliance program? etc...

Why couldn't you just wait the rest of the month and open a security when the laws are passed? How did you come up with this 36% yearly ROI number?

You are welcome to your opinion.

As far as my identity goes, I've verified who I am with BTCJam.

In terms of scaring away users, if you prefer to provide your name and social in lieu of providing biometric data that will be fine.  Personally I'd rather give up biometric data but that may just be me.

In terms of machine cost adding biometric scanning to a $40,000 ATM machine is actually not expected to amount to much.  The machine itself is the expense, not the options.  You seem to favor a picture of the user instead of a fingerprint scan, this is also a method we can use.  The key is that a single person cannot "anonymously" purchase more than $333 per day without providing some sort of and so to make sure all buyers are under the limit we need to have some basic "personally identifying" information from their very first transaction.

The loan is unsecured and relatively small.  Given this is my first loan request I felt the interest rate should be significant to offset the risk.  Of course it doesn't really matter what I set the interest rate at because I simply cannot avoid people coming out of the woodwork and calling me a scammer.  I will demnstrate that I am not a scammer.

You are welcome to loan me money or not, you are free to decide.  With BTCJam you can offer only a small amount of the loan.  I don't expect a single person to want to cover the entire thing as that would be awfully risky given you do not know me.

Hope I answered at least some of your concerns.

I posted this in reddit, but others should see this too:


You've got to be kidding. I can guarantee you this will scare away more customers than it will attract. I have a few issues with this.

First of all the price of these machines will be higher with biometric capabilities, and you could certainly lower them by removing such a [useless] feature (read on). Second of all, if you want to do KYC/AML there are plenty of other ways to do it without invading my cornea or storing my fingerprint. Your friend with 15 years doing ATMs should know that. Scanning an ID and storing the time stamp so you can access the CCTV records in the ATM at a later date would suffice.

Also some of us are going to need more than your first names and an otherwise unprovable resume before we start dishing out funds. The 'permits' you speak of are MSB licensing which require expensive surety bonds. you guys need to start answering some questions. imo this is beginning to feel like a scam. The whole 36% ROI is redic as well, I hope you see that. And the fact that you are in the lending section is even worse.

KYC (know your customer) requires you to collect information about your customer to avoid letting that customer trade more than $333 USD per day.  There is a $10,000 limit per month divided by 30 days = $333 per day.  

If you prefer to give your name and social security number we can go that route, but I figured few would care about giving up a retina scan or fingerprint.  There is no getting around identifying the customer to make sure you remain compliant with FinCEN regulations if you intend to sell bitcoin in America.


From a 1999 post:
http://slashdot.org/story/99/05/14/139247/retina-scan-atm-machines

Also, what would the biometric precautions do? I'm assuming you would go the way of fingerprints, because this isn't a James Bond movie. Is the plan to store finger prints to ID users who frequent the ATM? Because the majority of people don't have their fingerprints recorded, despite what CSI leads many people to believe.

To be frank, I'm not overly interested in investing, although I may if there was a lot of progress, however if you could explain your identification process, I'm sure others are wondering as well.

  Are you sure you want try something like this in a country like that?  If you redid the poll and mentioned the "protocols" i think the results would be quite different.  I think ATMs would be great but not like this.  Are we all criminals?  Why would anyone subject themselves to retina scans and fingerprinting to get some BTC?

In America bitcoins are considered money.  In Colorado it is illegal to pay more than the usury rate which is 45%.


"The general usury rate in this regard (for non-consumer loans) is set at 45% per annum."

"The usury rate established for consumer or personal loans is set at 12% in Colorado at the present time. (In fact, some of the western states currently do have some of the most liberal practices and statutes currently on the books when it comes to usury laws and personal loan interest rate limitations.)"

http://www.usurylaw.com/state/colorado.php

Illegal to pay more than 3% per month for the loan?  I doubt that, this is bitcoins!

https://btcjam.com/listings/6769

Our company is designing and will install a:
Bitcoin Automated Teller Machine (ATM)
in Denver, Colorado USA

This ATM will take in US Dollars and Distribute BTC.

Poll results from Bitcointalk:
Would you use an ATM machine to buy Bitcoins?
Yes   - 28 (80%)
No   - 2 (5.7%)
Maybe   - 5 (14.3%)
Total Voters: 35

https://bitcointalksearch.org/topic/would-you-use-an-atm-machine-to-buy-bitcoins-286114

We have permission to place an ATM machine in front of the 'Jefferson Building', in Denver CO.

The ATM machine we intend to place will cost more than $40,000 USD. This is NOT a loan for the ATM machine, this is the first of many small loan requests.

To comply with necessary identification protocols for the Department of Treasury's KYC (Know your Customer) and AML (Anti Money Laundering) our machines will include bio-metric scanners that will either scan the users retina or the users fingerprint and will limit daily purchases by a single person.

This initial loan is to cover the formation of the company, the establishment of the trade name and website and to cover the engineering and permits required to place the machine. Proceeds will also pay for legal counsel to guarantee our compliance with US Laws regarding the sale of cryptocurrency.

We will offer subsequent loans for the purchase of various hardware necessary to implement our system.

In Colorado the maximum loan amount we can pay is limited by the state. We are allowed to pay 3% per month.

In Colorado it is illegal for us to offer any security against the business at this time, however we expect this to change when crowdfunding laws are enacted later this year.

We will offer equity and debt securities to all lenders just as soon as the laws allow us to do that. The first crowdfunding laws go into effect as soon as September 23, 2013. To be clear anyone lending to us will be first in line to hold an equity position in our firm just as soon as the law allows but we are not offering any securities at this time.

There are two principals involved in this company, Sean and Steve. Sean went to an Ivy league University where he studied computer science with an emphasis on computer generated imagery. He then built a successful dot-com company which he retired from in 2009. Steve has an MBA from a large American University and is currently studying to get a law degree. Among other accomplishments he has programmed ATM machines for the last 15 years while employed as a digital security consultant by several large banks.

Interest will be paid back by personal income.

Thank you for your consideration.

https://btcjam.com/listings/6769