Peer-To-Peer Lending (P2P) is the most common practice for money lending via the online medium to develop businesses. The companies of this service have promised to serve the people at a much cheap rate of the price than the financial institutions. Therefore, both borrowers and lenders are benefitted in a great way. In this article you can know the huge benefits of this service in both borrower and lender’s perspective: The ways borrowers are benefitted Given below are some advantages which will state how peer-to-peer lending is benefitted for the borrowers:
- Availability of the high fund This model of lending service allows the borrower to get high fund ranges within $1,000- $35,000. It assists the borrower to arrange all the necessities to start a business. The large businessmen can invest the fund in their biggest dream project and any other huge investment.
- Speedy funding Another way by which peer-to-peer lending helps the borrower is its speedy funding. In this case, if the fund amount is lower than $5,000 it will get funded in your account within just a few days. In the case where the amount is quite high, it can consume a minimum of 1 week and a maximum of 3 weeks to provide you with the approved loan amount.
- Easy application procedure Peer-to-peer lending is completely based on an online medium. Its main motto is to provide the loan to the borrower quickly and reasonably. Thus, it has been designed in such a way so that the applicants find it easy to apply online. The applicants have to fill up the personal details of the application form and submit it. The loan approval confirmation will be received within a few minutes of submission.
- The low rate of interest Peer-to-peer lending is the only online loan service that offers the loan at a bank-like rate of interest. The leading P2P lenders of the country offer 7% APR to the customers. The rate of interest is also directly proportionate to the tenure of the loan offered by the lenders.
Benefits for lenders Given below are the ways by which peer-to-peer lending is benefitted the P2P lenders:
- High returns It is the biggest advantage the lender can obtain with this service. In the current marketing scenario, the lender can gain up to 10% return from this service. The return is depended on the loan type you offer along with time period too. In the pools of pre-qualified and FICO verified borrowers 10% return is quite high and impressive.
- Lenders get many choices At first P2P lenders ensure the identity verification of the applicants. After verifying required documents they provide the borrowers with the terms, amount and interest rate they can receive as the loan. After categorizing each applicant lenders offer the loan to only those who can be the cause of high return. As there are many applicants, lenders get a wide number of options to choose from.
- The percentage of risk gets lower The P2P lenders are not big financial institutions and earn only $25-$50 increments for each case. Rather than this, they are interested in the paltry rate of interest offered to them by the bank and public financial institution. It alleviates the stock market’s risk.
These are the reasons for the wide popularity of this online money lending service.
