What is Peer to Peer Lending

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What is Peer to Peer Lending?

• LenDenClub

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Peer to Peer Lending in India
P2P or Peer to Peer Lending platform connects
borrowers looking for a loan with lenders looking
to lend their money to earn returns. These
platforms, similar to banks, does the credit
verification of those looking for a loan and if
eligible, lists them on their online platform.
Investors/lenders can come, see the profiles
listed and decide if they want to lend them the
money or not.
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Why you should invest money in P2P Lending
Platform?
If you think the money you have kept in your bank
is for safekeeping, you are wrong. The money
deposited in your bank, is used by the bank to
lend to those who are looking to borrow. So what
interest you get in your savings account is
because someone else is paying an interest to the
bank, which the bank is giving back to you.
However, whereas a bank gives you the interest of
3 to 6 pa, they charge borrowers almost 10 to
20 pa. The difference? A whopping 7 to 17.
That's the earning of the bank. P2P Lending gives
you a higher rate of interest to a lender and
also a lower interest rate for borrowers.
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Benefits of Lender

• As a lender you have many benefits.
• You no longer have to waste your money sitting in
  a bank account with such low interest rates and
  lend through P2P lending platforms to earn upto
  35 return. 
• Unlike Mutual Funds, in P2P, you get your
  principal interest back every month.
• These returns can be reinvested as you receive
  the EMI from borrowers to further increase your
  earnings.

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Is it safe to invest in P2P Lending?

• No. Similar to any other investment asset, P2P
  comes with its own risk factor.
• If a borrower defaults, you could lose your full
  or part of the principal invested amount.
• However, since the returns are good, you can
  diversify your portfolio across multiple
  borrowers to reduce your risk and still earn a
  great profit.
• Not only that, but also to protect your money,
  many P2P lending platforms offer you recovery
  services and legal support.

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Thank You!
Be it a borrower or lender, peer to peer lending
has benefits for both. You can choose to ignore
P2P lending, but looking at RBIs latest
regulatory guidelines, P2P is set to grow further
and faster.
For more information visit us at
https//www.lendenclub.com