P2P Lending

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P2P Lending
Vishav - 29 October 2021
Peer-to-peer (P2P) lending has been gaining popularity in recent years. Many fintech companies are offering this new service where people can lend as well as borrow money. Here’s how P2P lending works and the risks involved. What Is P2P Lending? A form of credit service that enables an individual to borrow money directly from other individuals.   P2P websites are like aggregator marketplaces that bring together lenders and borrowers.   Any resident of India who has a PAN card and a bank account can become a lender or investor. RBI-listed NBFCs or companies formed under the Indian Companies Act can also be lenders. Starting steps for lenders include KYC verification, linking bank account and setting a preference for the type of loans they want to invest in.   Any salaried individual can borrow. Some websites have an age criterion, typically 21-55 years. Some checks determine the borrower’s creditworthiness. How Does It Work? Each P2P platform sets interest rates and loan terms. Interest rates are based on the borrower’s credit score, and are...
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