Peer-to-peer (P2P) lending represents a growing market that has gained traction with investors. P2P platforms create a market place for investors to lend money directly to borrowers. In return, investors receive an attractive yield – provided the borrower does not default.
This article lists 5 reasons to consider P2P lending. Firstly, traditional saving accounts offer low interest rates, causing the value of money to be easily eroded by inflation. Secondly, P2P generally offers attractive returns that beat inflation. Thirdly, P2P provides investors with the opportunity to diversify their investments. Fourthly, P2P platforms are becoming increasingly accessible to investors. Lastly, P2P helps support the economy by providing startups and SMEs with adequate working capital to grow their businesses.