Lucrative Benefits A Borrower Has, With P2P Lending

In this particular online manual, we are going to see the top four reasons as to how borrowers beat the edge with P2P lending. They come out of the shackles or tight nicks, banks or stringent financial institutions provide them with. Let us move on to see how it happens:

Simple process of filling up an online application form

Peer to peer lending sites just draw out a simple application form that needs to be filled up online. And you are all set, to have your loan money approved. You can apply a loan from an esteemed group of personal money lenders and from anywhere across the globe. Once your loan money is approved, you just have to wait until the money is credited into your bank account. The entire process is made a seamless affair for borrowers opting for short-term personal loans.

Interest rates

Borrowers with lower credit scores are also encouraged to apply for loans unlike the rigid norms followed by banks or financial institutions. So, as long as you have the money to pay, meeting up with the interest component should not seem a hassle, at all. You have an amazing Peer to peer lending company in India named the LenDenClub. Interest rate ranges between 12.5% and 30%. You will be assigned an interest rate as per your creditworthiness determined by the platform.

Speed of loan approval

Banks and financial institutes take a minimum of three to four week for approving even the minutest of minute loans. The reason why you are applying for a short-term loan is that you are in absolute need of money. With so much delay the banks put up with, how will you have money in your hand when you need it the most? Makes sense right? This is where you have peer to peer lending sites coming to your rescue. You will have your loans approved within 24 hours from the time you applied for a loan. This is the magic, a peer to peer company can bestow you with.

Medium-term loans are also taken care of

With a company like LenDenClub, you have loans starting off from Rupees 25,000 which can go upto Rupees 2,50,000. The tenure for re-payment is 3/6/9/12/15/18 months. You can choose the suitable tenure working for you. This way, your medium-term loan requirements can also be satiated.

You see, a group of personal money lenders operating online, can change your lifestyle, all together.

Amazing Advantages Lie in Store For A P2P Investor

Peer to peer lending is otherwise known as social funding. You select your own set of borrowers to whom you lend money out. Peer to peer lending companies thoroughly eliminate banks and financial institutions which act as middlemen. That is why borrowers and lenders seem to be in a win-win situation, with this form of investment. P2P investments or market place lending has started gaining prominence ever since 2005. Let us go on to unveil some of the most lucrative benefits a lender has, with a P2P investment.

Higher returns on investment

With a growing pioneer leader like LenDenClub, you are assured of a 20-25% returns on investment, with a moderate degree of risk attached. You lend money to borrowers whom you know. Though you can fall under the risk of default payments from borrowers, you have a unique initiative brought out by LenDenClub, which is also known as LPF (Lenders’ Protection Fund). Your capital is given a 100% protection against market or individual instabilities. Whereas your equities or mutual funds provide you with a 15% return on investment. Fixed deposits provide you with 8-10% returns on investment.

Monthly inflows

In a peer to peer lending market the money is credited into your bank account directly. And you are assured of monthly payments falling into your account. With FD’s, or mutual funds, you have your dividends credited every 3, 6 or 12 months. And there is no lock-in period with regard to P2P investments. You can take your money whenever you feel like. With the traditional investments, there is a minimum lock-in period only after which you have access to your principal money.

Spread of risks

Micro-lending is one aspect of Peer to peer lending, which is very attractive to investors as such. At LenDenClub, all you have to invest is a minimum sum of Rupees 5000. Even if some of your borrowers to whom you have lent money, default, you lose out on the bare minimum. In addition to that you have LPF which protects your capital.

You can spread your risks evenly and widely. Say you have lent money to 10 borrowers, Rs. 5,000 each at 25%. If one of them don’t pay his EMI, you will still receive Rs. 45,000 principal plus 25% interest on the same. Due to default by one borrower, your returns will come down by 5%, but you are still netting 20%.So, your risks are diversified and spread evenly.

This is how peer to peer lending companies are able to provide you with better returns of investment over traditional genres.

Top 4 Reasons For Financial Advisors Considering P2P Lending For Investors’ Portfolio

If there is some magical way available to make money, it’s to invest wisely. With growing opportunities and scopes for each effort someone makes, people look for potential investors. When it comes to selecting an investor, people look for its potential and judge reliability.

There are so many ways available to test the potential and trustworthiness of the investors. However, the most preferred way for the financial experts in modern times is to consider the peer to peer profile of the lender. Following are the top 4 reasons that are responsible for making the P2P portfolio of the lenders so much valuable:

1. These are authorized

Peer to Peer lending clubs in India like LenDenClub are growing big and popular. With P2P transaction being acknowledged by the RBI, these lending companies have become even more trustworthy.

In addition, the lenders over here are considered most trustworthy as the P2P lending platforms list only the verified profiles for the borrowers. The lender profiles have to pass through both digital and in-person verification.

2. Every detail at one place:

One of the prominent reasons behind financial advisors considering the P2P lending profile of the investor is due to their proven track record. As the lending clubs make details about the lender, like the amount of loan he has sanctioned, number of happy customers he has dealt with, etc. available over the profile itself, it becomes easy for a borrower to gauge the true potential of the investor (lender).

3. Quick transaction:

Transactions in contemporary times are quite swifter. As following the hefty formalities of the banks is a tedious task, as well as delaying, the borrowers these days look for the faster alternatives like P2P profiles. The financial advisors prefer going through the P2P portfolio of the investors as these portfolios make it evident about how habituated are they about quick transactions.

4. Scope to look for a better opportunity:

As the popularity of the P2P transaction is growing significantly, the competition among the lenders is also quite obvious to grow. In fact, some peer to peer lending companies in India have thousands of lenders over their platforms. It is obvious now for the competition among these lenders to grow to invest their money.

The advantage of such competition goes to the borrower only. For example, if you are ready to compensate at a greater interest rate, investors compete among themselves to pay big amounts. Again, as the number of alternatives in terms of lenders is pretty big with such platforms, the borrower gets the opportunity to go with the one offering loans at the minimal interest rate.