InvestorQ : What are P2P loans and how can one get it?
Diya Chitale made post

What are P2P loans and how can one get it?

Pratik vyas answered.
3 years ago

Peer-to-peer (P2P) lending is a method of debt financing, or borrowing and lending money, that enables individuals to borrow and lend money without the use of an official financial institution as an intermediary.

Peer-to-peer lending removes the middleman from the process. P2P lending is also popularly known as crowd lending or social lending.

The reason P2P lending has become so important amongst credit providers is due to the ease it provides. Whether you are a newbie or an expert in borrowing, by following the following steps, you can quickly become a part of the P2P or peer-to-peer lending system:

  • Log on to reliable P2P sites that provide services in your geography and then sign up and become a member just as you would do on other websites.
  • The website that you choose to sign up for becomes an intermediary between you and the prospective lender and conducts all formalities.
  • The website itself will connect you with the prospective lender.
  • As a borrower, you need to go through a number of checks to verify your account. These checks are on your personal details, background, your employment status and credit history.
  • This quality check is the most stringent step in the entire process of taking a loan on a P2P website. The reason for the same is to minimise risks as much as possible and only lend to genuine and credible borrowers.
  • Bidders as well as lenders check all the information you provide as a borrower, so it is advisable that you post your accurate details.
  • Up on receiving your approval, you will be provided with a number of options to choose from.
  • To receive desired bids on your loan, you can fix an interest rate for the loan and receive the bids.