Why security is king in P2P lending

From Stuart Law at FT Advisor:

“The Peer to Peer (P2P) lending market has risen from zero, around 10 years ago, to an outstanding investment level of more than £8.7bn of loans in the UK alone. Investors of all shapes and sizes are continuing to flock to the market, attracted by the prospect of a fair, risk-adjusted return on their capital and to beat the low rates offered from traditional sources. In fact, you’ll find what differentiates the various players in the market is how they deal with loan security. There are two key aspects to be examined in detail: 1) Pre-approval of loan: The checks put in place to ensure that high-quality loans are approved, where the loan can be afforded by the borrower but still recoverable in case one day it is not. 2) Post-approval of loan: The measures put in place to deal with loans defaulting and the recovery of capital in that situation.  ”

In the emerging market of peer-to-peer lending, it’s essential to present a security of funds and return for players in this market to attract investment. Investors concern more of their risk-adjusted return from an essential mean-variance analysis. Instead of focusing on promoting fancy and attractive conceptual terms, P2P lending providers need to show their effort in managing the risk exposure as for investors’ unit return of investment, as well as great management for dealing with repayments of loan. Capital Match is the largest player in Singapore the P2P Lending market with over $40 million origination, and it’s continuously offering investment invoice financing/PO financing options of good quality to help its investors have healthy growth of their portfolio.
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3 Ways To Free Up Cash and Grow Your Business

From Megan Totka at Small Business Trends:

“Nearly every business that exists shares a common goal: to make more money and find financial success. You have to constantly focus on cash flow management, profitability and increase the value of your business if you want to prosper. Invoice factoring companies let you turn current, unpaid invoices, into cash without adding new debt. Free up your cash to help you meet payroll, add new products and services to your offerings and extend the geographical reach of your business. Factoring companies allow you to transform your business cash flow and will give you the access to the funds you need without worrying about invoices staying open as long as 120 days. Instead of sitting and waiting for payment, you can proceed with new work, pay employees, or buy needed supplies. Check the online Factoring Directory to help you find the best factoring that aligns with your business needs.”

SMEs need to take steps on improving cash flow management to free up the needs for working capital. Besides getting early settlements on payment and improving marketing, modern invoice financing is a great tool supporting SMEs to have steady cash flow for the operation. Supported by current fintech era, P2P lending in Invoice Financing is changing the way people invest and how SMEs are getting loan. In Singapore, the biggest lending platform Capital Match is providing efficient and reliable source of alternative funding for SMEs. Continue reading