A Primer On P2P Platforms

You may as well know you can earn money online by being a Virtual Assistant of someone else. Meanwhile, you can instantly borrow money from banks and lenders online. With just a few clicks, you're there.

But did you know you could borrow money from different online users using P2P lending?

Welcome to the future!

Let's Define It

P2P or peer-to-peer online lending companies use the money of savers and let borrowers use them. The borrowers are carefully selected. Most borrowers include normal people, small businesses and landlords. Without the need of banks and building societies, savers and borrowers are given a better rate.

While P2P lending platforms take a small cut, it is not as huge as banks would charge.

Disadvantages

While this all sounds good, P2P is not without its flaws

The local government will not back any losses from your savings if the P2P platform makes a flaw. 

Most bank services are covered by the Government-sponsored Financial Services Compensation Scheme which would guarantee the first £75,000 held in a standard account.

Crowdfunding Vs. P2P Lending

Services provided by Zopa.com, RateSetter, LendingWorks and others provide money for any reason. 

Clients only need to fulfil the necessary requirements to ensure they can repay their rates at the intended time.

Most people mistake P2P lending as crowdfunding. Crowdfunding is when people invest in your project, financing it as they believe in its success, or they find a need for your products.