Peer-to-Peer financing is one form of crowdfunding. Crowdfunding is a way of raising finance by asking a large number of people each for a small amount of money. In simple terms, peer-to-peer financing refers to individuals (investors) providing finance to businesses (customers) without the use of a conventional intermediary such as a bank.
Headquartered in Dubai, Beehive successfully launched the UAE’s first online marketplace for peer-to-peer financing. Having recognised the demand for its unique approach to finance currently underserviced in the Asian markets, Beehive has chosen to create an Asia platform with Thailand, itself a leader in innovation, as the gateway to regional expansion of our services.
Beehive has worked with prominent Islamic legal advisors and Islamic finance industry experts to develop a Murabaha structure that complies with the principles of Sharia. The structure allows Islamic investors to take full advantage of the opportunities that Beehive has to offer while providing complete confidence that their values are respected and adhered to.
All “Beehive Sharia Compliant” finance requests are processed through the UAE’s award-winning “DMCC Tradeflow” Commodity Murabaha platform operated by the DMCC. Finance requests that do not comply with the principles of Sharia are processed as a conventional finance structure and are not accessible to investors who have indicated they would only like to invest in Sharia compliant opportunities.
Beehive P2P Limited is registered as a DIFC company with registration number (CL2352). Beehive P2P Limited is authorised and regulated by the Dubai Financial Services Authority under number F003177.
Beehive values your business and is seeking your full satisfaction with the level of service you receive. Even the best organisations sometimes make mistakes, and if we do, or we fail to meet your expectations in any way, we will make sure we take all necessary actions, where appropriate, to make things right and the extra steps required to prevent a recurrence.
You can provide us with your feedback and complaints through one of two ways:
Via e-mail: e-mail us on firstname.lastname@example.org with details of your feedback or complaint and a member of our team will send you an acknowledgment via e-mail within 1 working day.
Via phone: Call us on +971 4 550 6700 and our team member who receives the call will and a member of our team will send you an acknowledgment summarizing your feedback or complaint via e-mail on within 1 working day.
Beehive will take necessary action to resolve your issue within 10 working days of the date you received your acknowledgment of your feedback/complaint. However, if you are dissatisfied with the response you have received, please let us know so that one of our senior managers will personally handle your feedback/complaint.
This means you have reached the end of our complaints procedure, and if you are still dissatisfied (or one month has passed since you first raised the matter with us) you have the right to refer your complaint to the Dubai Financial Services Authority (DFSA) by contacting them on https://www.dfsa.ae/consumer/complaints.
Simply click on the “register” option showing on the top right corner of our website and fill in the required information. Once done you will receive an e-mail requesting copies of your passport and proof of residence (i.e: tenancy contract, DEWA bill, employment letter) which you will need to send to email@example.com. Once completed, your details will be verified and you will receive an e-mail within 2 to 3 working days notifying you that your account on Beehive has been activated. In some cases additional documents may be required.
What is the minimum amount required to open an account on Beehive? And what is the minimum/maximum bid?
You can join Beehive by setting up an account with as little as AED 1,000. The minimum bid on an individual business is AED 100 and there is no maximum.
Investment on Beehive is intended to support business expansion, for things such as working capital and growth financing, and therefore will be unsecured against specific assets. To reduce the risk of default, all businesses must provide the necessary guarantees in line with UAE practices.
Each business undergoes a rigorous risk assessment undertaken by our experienced internal risk team and further supported by robust third party on site verification. Only successful businesses will be listed on the Beehive marketplace.
Each finance request is given its own rating based on a multiple number of data points which contribute towards an overall risk band. We look at both quantitative and qualitative measurements, including revenue growth, profitability, strength of management team, sector competitiveness, etc. We have our own proprietary risk model which is supported by Dun & Bradstreet who act as an external party to carry out our field verification visits. The metrics which are provided on the platform are a summary of the multiple data points we review during our risk assessment process. Learn More.
Beehive operates a secondary market which gives investors the option to transfer outstanding investment parts to other investors on the platform. Investments can only be transferred on the secondary market once the business has successfully made a repayment.
At Beehive, we only allow established creditworthy businesses onto our platform and our experienced credit assessment team undertake robust rigorous risk checks on all businesses that apply for listing on the platform in addition to obtaining all necessary legal documentation as part of our assessment. Although we undertake detailed risk checks and only allow creditworthy business to apply for finance on our platform, no investment can ever be entirely risk free and even creditworthy businesses may default. A fundamental principle of Beehive is that we always encourage our investors to diversify their investments across multiple businesses to lower their risk of capital loss.
Since this is an unsecured investment, in cases where a business defaults, the risk is borne by the investor. Beehive will do everything in its power to collect the dues and will start legal action if deemed relevant. All finance requests are backed by (i) postdated cheques for each monthly instalment or a monthly electronic repayment mandate; (ii) an undated security cheque for the full amount; and (iii) a personal or corporate guarantee. If Beehive is unable to collect outstanding monies from the business, then investors will need to wait until such time that money is recovered from the business through conventional legal process if deemed commercially viable.
Beehive welcomes all applications from all nationalities even if they are not UAE residents, however certain restrictions apply due to local regulations.
We take our investor take-on procedures very seriously and all of your details are vetted by our third party DFSA regulated fund administrator. To comply with UAE, DMCC and DFSA investor take-on regulations, we have to understand who you are, your source of funds and your previous dealings. We do not have the power to take money from your bank account; you make all transfers into a segregated bank account. We need your bank details so that if we are asked to return funds, we know which bank account to pay them into.
The Beehive Marketplace allows investors to make bids related to a specific finance request for any of the approved businesses. Once the auction is open, investors can choose which business to invest in and at which rate. Bids are processed as a “reverse auction”, and the highest rates gets declined first once a financing request is 100% funded. The auction is open for 2 weeks and the business has the option to accept or decline the financing bids from investors once the auction is closed. This unique process automatically lowers the overall financing rate for the businesses, while still giving investors the opportunity to lock in the rate of return they want.
Taking a very simple example, if a business asks for AED 100,000 and you offered AED 50,000 at 16% and another investor offered AED 50,000 at 14% then the finance request would be 100% funded. Under this scenario, the business would pay 15% (average of 14% and 16%) but you would receive profit at 16% and the other investor would get theirs at 14%. If a third investor offered AED 50,000 at 12% during the two-week auction period, then your bid would automatically get rejected and the business would now be paying an average of 12% and 14%. You could make another offer if you wanted, which would drive down the cost to the business. The rate is fixed once the auction is closed (at the two-week maximum) or immediately once the business accepts the rate (even if before the two-week limit), and that is the rate the business is committed to pay during the duration of the investment.
As an investor, you get to offer your desired rate to a specific business with the minimum of 6% and the maximum of up to 22% depending on the risk rating of the finance request. The rates are as follows:
- A+ risk band: Profit rates from 6% to 12% APR
- A risk band: Profit rates from 6% to 14% APR
- B risk band: Profit rates from 8% to 16% APR
- C risk band: Profit rates from 10% to 18% APR
- C- risk band: Profit rates from 12% to 20% APR
- D risk band: Profit rates from 14% to 22% APR
*Annual Percentage Rate (APR) is calculated on a reducing capital balance basis.
* To convert from APR to flat rate you should divide the APR rate by 1.81 (e.g: 15.0% APR = 8.33% flat).
Accepted offers are repaid via equal monthly installments and each amount is paid directly into your Beehive account. The monthly installment comprises capital and profit and the profit is calculated off a reducing capital balance (APR). As an example, if you invested AED 10,000 over 24 months at a 15% profit rate then your repayment schedule would be as set out below. Each month you would receive AED 484.87 and over the 24 month term you would receive AED 1,636.88 profit. To maximize your return on invested money on the platform, you should reinvest the monthly installments into new bids. We recommend that you set your Diversification+ settings to assist you achieve strong returns.
Investor funds on Beehive sit in a fully-segregated UK custodian bank account operated by Global Currency Exchange Limited (GCEN) (UK company registration number: 04675786) and Global Custodian Services Limited (GCS) (UK company registration number: 08321940). GCEN is authorised and regulated by the UK’s Financial Conduct Authority (FCA) under the Payment Services Regulations, 2009 with registration number 504346; and GCS is authorised and regulated by the FCA for arranging transactions in investments with registration number 595875.
GCEN and GCS can only accept electronic transfers and so Beehive also operates a separate segregated client monies account via another Beehive licensed company “Beehive Services DMCC” solely for cheque payments. Cheques paid into this account are swept into the GCEN / GCS account within five working days of deposit.
For Business Finance and Project Finance requests we charge the following:
- 2% annual fee for investors (charged as repayments are made).
For depositing funds in your Beehive account, your bank may charge a transfer fee which will be deducted from the amount you transfer to your Beehive account.
All repayments and profit accrued will be credited to your Beehive Account on the platform. You can then choose the “withdraw funds” option on the “dashboard” and follow the steps, you will then receive the funds in your desired bank account within 3 working days. As per Beehive’s Terms and Conditions, investor funds cannot be withdrawn until 90 days have passed from date of deposit due to anti-money laundry regulations. There may be bank charges associated with withdrawals.
Currently Beehive only accepts applications from UAE based businesses.
Businesses will pay a completion fee based on the finance term from 2-4% as per below
- Charge for 1 year finance = 2% of principle amount
- Charge for 2 years finance = 3% of principle amount
- Charge for 3 years finance = 4% of principle amount
Yes, businesses can have more than one active finance request at any point in time. Please note that any new application will be subject to a full credit assessment. Furthermore, the business must have made a number of successful repayments on their existing facilities.
All businesses applying for finance request on Beehive need to provide the necessary financial and business documentation in order that a full risk assessment can be completed. The information Beehive requests is in line with regional bank financing.
All repayments on Beehive are made either through electronic monthly repayments or monthly post-dated cheques in line with UAE banking practices.
Yes, you can pay back early. There are no penalties or charges for early repayment of your finance at Beehive.
You are the Investor and you enter a Finance Contract between yourself (with potentially other Investors) and the Business who has supplied the goods or service to the Customer.
The contract is between you as the Investor(s) and the Business. Neither Beehive nor the Customer is party to the Finance Contract.
You need to first be registered on the platform as Sophisticated or High Net Worth Investor and you can send an email to firstname.lastname@example.org requesting to become an Invoice Finance Investor. Due to the nature of the product, Invoice Financing is only available to Sophisticated and High Net Worth Investors and Institutions.
No, you must be classified as Sophisticated or High Net Worth Investor and has a total deposited amount of aed 50,000 (this includes invested capital and uninvested funds). If you did not register as Sophisticated or High Net Worth Investor we will email you the IF Self Certification Form.
I am an investor for Business Financing and Invoice Financing, how do I set the allocation of my funds?
You can set the amount of your funds allocated to Invoice Financing through the Invoice Finance Strategy page.
Unlike Business Financing, Invoice Financing does not include a reverse auction that an Investor can manually partake in. Instead, all investors set their Financing Parameters, and when a Business is seeking finance, they enter their invoice details and our Platform automatically matches the lowest cost of finance available from the Platform Investors based upon the Investors’ Investment Parameters. This ensures that finance can get to Businesses within 24 working hours, which is critical for them.
Click on the Invoice Financing icon on the dashboard.
Yes, you can amend your parameters whenever you wish to. These will be applied to all new bids.
You set the term of how long you wish to finance which is between 60 and 120 days. At Beehive’s discretion, a Business may also request an extension period of up to 30 days and so payment may be up to 30 days longer than you have set. Note that profit continues to accrue if payment is later than requested.
Yes. On your Investment Parameters is a link to “Set my Businesses and Customers”. You are automatically set to finance all Businesses but you can choose to deselect any Business and / or any Customer.
We undertake a thorough review of the Business and only allow them to request finance against large established Customers that have a strong payment track record with that Business.
See the “Businesses and Customers” link which sets out the various parties.
The Business can opt to (i) have direct payment, where the Customer pays Beehive directly; or (ii) have indirect payment, where the Customer pays the Business and then the Business pays Beehive the capital, fees and charges. You can see whether Businesses have elected for Direct or Indirect Payment on the Businesses and Customers page.
Beehive takes a 20% fee of the profit generated by your investments. This is taken automatically before profits are distributed back to your Beehive account.
You will receive your funds including the profit gained in your Beehive account when the Customer or the Business pays us. Profit is calculated to the day so if a Business pays early, the forecast profit will be lower. Likewise, if the funds are received by us later that requested, then additional daily profit will accrue.
The Business requests finance for the expected payment terms rather than the actual ones stated on the invoice. Therefore, payment should closely mirror the requested finance. However, a Business also has a 30 day Grace Period above and beyond the requested payment term. Profit continues to accrue at the agreed daily rate for any late payments.
No they are not, although we are currently reviewing this to see if there is an economically feasible solution.
The finance contract is between you and the Business (not the Customer). Therefore, the Business is liable to repay the funds. If a Business defaults then we will decide the optimal route to collecting dues.
No, the invoices are not assigned to Beehive or you as an Investor, and neither you nor we have right of recourse over the Customer.
Although this is unsecured financing, we hold an undated security cheque from each Business for their full agreed credit limit and personal / corporate guarantees.
Yes, due to the size of the financing, you must invest a minimum of AED 50,000 on the platform.
You are able to set your return at a rate of between 0.75% and 1.25% per 30 days. This is before Beehive’s Fees.
Click on the register link and complete the requested information.
We will review your Customers and your debtor listing and agree which Customers will be applicable for Invoice Financing. The Customers must be large businesses and have a strong payment track record with you.
The cost is set by the market and will be based on a number of factors. The actual cost will be between 0.75% and 1.25% per 30 days payable to the Investors and we charge a one-off fee of 1% per invoice written.
Investors set the term they wish to forward funds for which will be between 60 and 120 days.
Assuming your physical invoices and supporting documents match the details uploaded, you should receive funds within 24-48 working hours.
Yes, we will set a credit limit with you. This can be amended at any point in time at our sole discretion.
There are two methods:
1. Direct Method: Under this method, you give your Customers Beehive’s bank details and they pay Beehive the full invoice value. Beehive then repays you the un-financed element of the invoice.
2. Indirect Method:Under this method, your Customer repays you the invoice value and then you settled the Beehive financing and related costs directly with us.
Yes, profit is calculated to the day so paying off your finance early decreases your cost.
When you ask for financing, you will insert your expected payment date as opposed to the actual terms. If your Customer pays you later than you expected then Beehive allows at its discretion, a 30 day extension period. After that, the financing must be repaid or you will be in default. Profit will continue to accrue during the extension period at the agreed profit rate.
Individual invoices cannot be partly repaid.
We do not ask for the assignment of invoices.
Islam is more than a religion; it’s also a code of life that deals with social, economic and political matters.Muslims are expected to live according to Sharia (Islamic Code) which governs nearly all aspects of Muslim life, and hence Sharia imposes certain restrictions on finance and investments within the Muslim community. Islamic finance refers to the means by which corporations raise capital in accordance with the principles of Sharia, money must be used in a productive way and generating return on your money must be through legitimate and ethical trade or investment which includes an element of risk and promotes social justice. Generating interest on your money is seen as an effortless income and is not permitted in Islam. Sharia also does not permit trade or investment in unethical industries or commodities, such as: arms, gaming, gambling, alcohol, conventional banking or insurance, non-halal food or beverages, entertainment and more.
Peer-to-peer finance (P2P) aims to build a community of investors and businesses where risks are shared and capital is channelled into real economic activity that would benefit the community. Essentially, P2P follows the basic Islamic principle of sharing risk for profit rather than the model used by banks which is transferring risk for profit.
Islamic investors have always faced challenges with diversifying their investment portfolios due to the limited investment options available that adhere to Sharia principles. This need required the development of alternative finance tools to better serve the Islamic investor markets and help create more diversified portfolios for better managed risk. Beehive recognized this gap and managed to work with prominent Islamic legal advisors, and Islamic finance industry experts to develop a structure that processes investments in a Sharia compliant way.
Islamic investors who wish to engage only in investments that comply with Sharia select the “Sharia Compliant investment only” option when they are registering to the Beehive platform. This allows Islamic investors to place bids only on finance requests that comply with Sharia. All businesses applying for finance are meticulously checked to ensure that the business activity and use of funds comply with the principles of Sharia. If the business activity and use of funds comply, Beehive identifies the request as “Sharia Compliant” and Islamic investors are able to place bids on the marketplace. Any finance requests that do not comply with the principles of Sharia are processed under a conventional finance structure, restricting Islamic investors from bidding on the request.
Beehive processes all “Sharia Processing” finance requests through the UAE based award-winning “DMCC Tradeflow” Commodity Murabaha platform. “Murabaha” is a commodity-backed transaction that allows Islamic investors to buy and sell commodities at a profit on a deferred payment basis.
The word Murabaha is derived from the Arabic word Ribh that means profit and it is the most popular and most common technique of Islamic financing. Murabaha is also known as Mark up or Cost plus financing and it is estimated that that 80% to 90% of financial operations done under Islamic finance belong to this category.
Murabaha is simply a contract of sale in which a commodity is sold on profit where the seller is obliged to tell the buyer his cost price and the profit he is making. In a Murabaha transaction, the first party purchases a commodity today which is then sold at the current market value plus the agreed profit to the second party at an agreed upon deferred payment plan. The second party can then monetise the commodity by selling it today, at today’s value, and receive cash.
The DMCC Tradeflow commodity Murabaha platform which is operated by the Dubai Multi Commodities Centre (DMCC) is an online exchange for physical commodities based in the UAE that allows the electronic transfer of ownership through tradeable warrants. The commodities and storage facilities are also reviewed to ensure full compliance with Sharia.
DMCC Tradeflow has been confirmed as being fully Sharia compliant by one of the world’s most prominent Sharia scholars, Dr. Hussain Hamid Hassan, Founder and Chairman of Dar Al Sharia Consultancy and Chairman of the Fatwa and Sharia Supervisory Board of Dubai Islamic Bank. Dr. Hussain is considered a pioneer of modern Islamic banking having shaped the industry since 1975. He remains a guiding force to AAOIFI and IFSB, regulatory bodies for the Islamic finance industry.
For more information on DMCC Tradeflow, please visit www.dmcc.ae/tradeflow
The world recognised and respected, Shariyah Review Bureau (SRB), together with their team of esteemed Sharia scholars, have reviewed and certified the “Beehive Sharia Processing” in terms of operational processes, documentation, business activity and relationship management. The certification makes Beehive the first P2P platform in the world to independently confirm its processes are compliant with Sharia principles.
Shariyah Review Bureau (SRB) have been providing professional Sharia advisory and Sharia audit services for more than 10 years to public and private businesses, including commercial and corporate debt, sukuks and Islamic equity markets, initial public offerings screening and investment banking practice, energy firms and information providers.
Licensed by the Central Bank of Bahrain, SRB serves clients from the US, UK, Switzerland, Canada, Hong Kong, Australia and GCC. In Saudi Arabia alone it holds a 21 percent market share of the Co-operative Insurance Firms Listed on the stock-exchange market, and 13 percent share of all Saudi Investment Companies licensed by the Capital Market Authority (CMA). Its service offerings span a broad set of complementary disciplines that include product certification, consultation, Sharia audit and equity screening. SRB has a scholarly presence in more than 12 countries, including the US, Europe, Africa, GCC and Asia, making it a unique Sharia consultancy body that can meet the true international business requirements of its clients.
For more information on SRB please visit www.shariyah.com
A key purpose for imposing Sharia is to promote social justice. Sharia is more concerned with ethical, social, economic, and political impacts of investments on the economy and directs it towards responsible activity that benefits other people and the overall economy. Conventional finance does not have the same ethical or social considerations.
Sharia and conventional investments involve the same degree of risk, however Sharia investments are processed in a different way and are limited to businesses that adhere to the principals of Sharia. Investment in business involved in unethical industries or commodities, such as arms, gaming, gambling, alcohol, conventional banking or insurance, non-halal food or beverages, entertainment and more, is not permitted by Sharia.