Cambist’s marketing may have created the expectation that users would see a 19.5% annual gain on the full capital amount they put into the platform. This is far from the case.
Business scrutinised several Cambist contracts and discovered the gain on the original capital was not more than 11%. These figures have been independently verified. To understand this, it is necessary to explain the way Cambist works. Users buy active contracts on the platform at a set amount. In return, they are promised monthly return “instalments” over a set number of months, and a “total profit”, which is what they ultimately get back over and above their initial capital outlay. These figures are fixed from the start.
Joining the dots
Business did its own calculations, using two examples provided on Cambist’s website and three independent examples.
The first two, buying Cambist products for R5 247.56 and R4 789.11 over 9.12 and 16.13 months, produce total repayments of R5 664.74 and R5 462.09, or respective returns of R417.18 and R672.98, Cambist promises. But the returns equate to 10.46% and 10.45% – way below the promised 19.5%.
Independent calculations did much the same thing.
Products worth R3 580.04, R6 830.00 and R2 003.05 over 9.18, 18.62 and 6.45 months produced total repayments of R3 834.95, R7 880.73 and R2 100.19 – respective returns of R257.65, R1 051.73 and R99.95, or 9.41%, 9.92% and 9.19%, again way below the promised profit rate.
However, Cambist does not actually offer the 19.5% on the total capital amount. Its website says it only pays the 19.5% on a user’s “active capital”.
Every month’s instalment includes a portion that is profit, but the rest is part of the user’s initial capital being returned. So the capital amount on which Cambist is promising the 19.5% actually decreases every month.
As an example, if a user buys a contract for R2 000 and the capital repayment is R200, then the profit for month two is calculated on R2 000 minus R200, in other words R1 800.
So the annualised profit on the total capital amount is always far below 19.5% because the capital decreases far quicker than profits are paid. In the end, users earn gains on almost nothing.
Treadmill to nowhere
And the only way for users to actually secure the highest interest rate is to keep buying new contracts with every repayment.
But an analysis of Cambist’s contracts and verified by an independent accountant failed to find a single one that paid a rate of 19.5%, even using the platform’s “active capital” principle.
Simply put, Cambist’s users have been duped. The 19.5% gain does not exist.
Cambist manager Lise Oerlemans did not respond to queries.