The Fintech room has seen significant growth in peer-to-peer lending. Online loans and loan doors eliminate intermediaries and let you borrow money directly from investors at a lower level. You can also look at this websitefor more information about p2p loans.
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1. Grow exponentially
According to market experts, the Indian P2P lending industry will reach $ 5 billion by 2020. This is quite surprising. It is not an exaggerated estimate, but it is not impossible to predict.
2. Cheaper default
In recent years, corporate loan defaults have risen with prominent entrepreneurs leading the list. Market loans, on the other side, have default levels in the range between 3-5% and are as cheap as any other loan. They can also be ignored.
3. Invest in a regulatory environment
This was the impact of India's P2P loan platform. It was only natural that the country's highest financial regulator would step in. The P2P sector is recognized by the RBI as a part of the broader NBFC category (nonbanking, non-banking). This sector can add value.
4. Easy and profitable
Contrary to popular belief there are investments assets that outperform equity and have fair margins. Investors can easily achieve a range of 25-35% through P2P loans with zero volatility.
5. Feel-good factors
The P2P loan platform is a great way to digitalize. Peer-to-peer lending could be the future in finance in this country, with so many positives!
Peer-to-peer (P2P) lending, which is also known as social lending, allows individuals to lend and borrow money directly to one another. Just as eBay removed middlemen between buyers and sellers, P2P lending companies like Neo finance eliminate financial intermediaries such as banks and credit unions.
P2P lending improves outcomes for individuals who offer capital and reduce interest rates for those who use it, but it requires more time and effort from them and includes more risk.
The basics of social loans
P2P lending is a product of important business, technology, and social trends, including:
A new generation of ‘freeformers’ who combines freedom with social activism. Freeformers want to take control of their work and leisure. Instead of working for one company for 35 years, they prefer to collaborate within the network for a short period on a variety of projects.
Deployment of web technologies, which foster mass collaboration. New tools enable people to work together online in large groups to achieve common goals (eBay and social networking sites such as Facebook are examples).
Dis-intermediation of everything. Technological change, globalization, and other international trends continue to reduce the number, size, and the role of business intermediates in various industrial sectors.
The development of micro-loans to individuals with few assets in developing countries. Loan entities and social community-minded, such as credit unions, have been around for a long time. But microlending gave impetus to the idea of social objectives to make small loans to individuals.